Beginning in 1933 risk assessment maps developed by the Home Owners’ Loan Corporation directly influenced the mortgage lending of private banks, the Federal Housing Administration, and the Veterans Administration. The restriction of financing on the basis of race became known as redlining. The Federal Housing Administration used and continued to update the maps, continued the HOLC’s use of race and the criteria of “inharmonious racial groups” in their ratings, and recommended the use of racially restrictive covenants. Redlining codified the use of racial discrimination to enhance real estate markets and formalized segregation as federal policy. It also incepted redevelopment projects that resulted in widespread displacement, dislocation, and dispossession. Like sharecropping, redlining systematically maintained racial-economic subordination to white citizens, federally defining the terms of property ownership on the basis of race.
