Mozilo: Lower the Bar for Minorities

Lenders should lower the bar of entry for minority and immigrant borrowers by taking another look at their FICO scores, according to Angelo Mozilo, chairman and chief executive of Countrywide Financial Corp.Many times, scores of 450, 500, and even higher should be approved but are not, Mr. Mozilo told attendees Sept. 22 at the 17th Annual New England Mortgage Banking Conference in Providence, R.I. "The minority life experience is not that of the majority. Their FICO score is not going to be the same as white America," Mr. Mozilo said. "We as an industry and GSEs need to reach out and lower the bar of entry, take a risk that these borrowers might fail -- but most succeed." Zero downpayment is the way to go, he said, adding that a 10% downpayment is no way to improve a loan for such struggling borrowers. "Ten percent won't help them," Mr. Mozilo said. "I'm not saying all of them should be approved. But give them a shot."