Covenants Neighborhoods Suburban Expansion Before 1938
Zoning Public Housing Resources Eminent Domain Buying on Contract
With FHA (Federal Housing Administration) and HOLC (Homeowners Loan Corporation) loans out of reach, “buying on contract” was the process of “renting to own.” Minority home buyers were baited with the dream of homeownership, with the loans offered by real estate agents. The reality instead resulted in attempting to purchase homes under the agreement and conditions of a real estate broker. The broker owned and loaned the property to prospective buyers who did not have access to bank loans. The process of buying from the broker and owner created loans access with no protections or liability. Since FHA and HOLC loans did not operate in neighborhoods with poverty and areas where inadequate municipal services, “buying on contract” became the purchase method for many minorities well after the postwar period.