Race Split Discovered In Credit Reports -- Blacks Likelier To Have Bad Credit, Study Says

African Americans are far more likely to have bad credit records than whites, even when blacks and whites with similar incomes are compared, according to a study being released today by the McLean, Va.-based Freddie Mac home-financing corporation.

The study found that whites earning less than $25,000 had better credit records as a group than African Americans earning between $65,000 and $75,000. Overall, 48 percent of blacks and 27 percent of whites had bad credit ratings, as defined by Freddie Mac in this study.

Although the study did not attempt to establish conclusively why the disparity exists, researchers speculate that black Americans have fewer resources to fall back on in times of trouble. They suspect cultural attitudes also contribute: For example, it is known that people who believe they control their lives tend to budget better and save more. Although credit reporting is supposed to be colorblind, some experts said that racism may contribute to the economic instability that leads to unpaid bills.

Freddie Mac, which is federally chartered to provide capital for mortgage lending, plans to use the results of the $1.3 million study and an in-depth survey of consumer knowledge and attitudes to develop a course intended to change behaviors. The NAACP, the National Urban League and five historically black colleges will help develop and disseminate materials in the $2 million program.

According to the study, almost half of all African Americans have bad credit records - a rate nearly twice that of whites.

The researchers, who examined the credit reports of a scientific sampling of more than 80,000 people, gave a bad rating to anyone who in the past two years had two bills overdue more than 30 days, one bill more than 90 days late, a lien or judgment against them, or a bankruptcy.

The statistics also showed that 48 percent of African Americans with incomes between $45,000 and $65,000 had bad credit, compared with only 21 percent of whites. Hispanics in that bracket had a slightly worse record than whites - 28 percent had credit problems.