Community Profile: Philadelphia, PA-NJ MA

Executive Summary

Demographics

According to the 2000 census, the Philadelphia, PA-NJ MA had a population of 5,100,931, representing a 5.0 percent increase from 1990. Pennsylvania’s population increased 3.4 percent during the same time period and New Jersey’s population increased 8.9 percent during the same time period.
The racial composition in 2000 was 72.1 percent white, 20.1 percent black, 5.1 percent of Hispanic origin, 3.4 percent Asian, 2.8 percent of other races, and 1.6 percent of people who reported two or more races.
The number of households was 1,914,246, and the number of families was 1,289,666.
The median age of Philadelphia, PA-NJ MA residents was 36.4 years in 2000. The median age of Pennsylvania’s residents was 38 years and the median age of New Jersey’s residents was 36.7 years.
According to the 2000 census, in the Philadelphia, PA-NJ MA, 69.9 percent of the housing units were owner-occupied, compared with 71.3 percent for Pennsylvania and 65.6 percent for New Jersey.
In 2000, 13.6 percent of the population of the Philadelphia, PA-NJ MA was at least 65 years old, compared with 15.6 percent in Pennsylvania and 13.2 percent in New Jersey.
While the white population in Pennsylvania declined 0.34 percent between 1990 and 2000 and 0.42 percent in New Jersey, it declined by 1 percent in the Philadelphia, PA-NJ MA.
The year-round vacancy rate in the Philadelphia, PA -NJ MA was 6.2 percent in 2000, compared with 6.2 percent for Pennsylvania and 4.1 percent for New Jersey.

HMDA and CRA Loan Data

In 2001, the approval rates for applications for conventional and government one- to four-unit residential mortgages increased by income category of applicant. Government approval rates were 78.6 percent for low-income, 82.7 percent for moderate-income, 85.2 percent for middle-income, and 85.4 percent for upper-income applicants, compared with 56.0 percent for low-income, 69.9 percent for moderate-income, 76.9 percent for middle-income, and 79.6 percent for upper-income applicants for conventional mortgage loans.
The total number and total dollar amount of HMDA-reportable loans decreased 19.2 percent and 19.0 percent, respectively, from 1999 to 2000 but rebounded 46 percent and 77.2 percent from 2000 to 2001.
In 2001, refinances of existing mortgages represented 49.8 percent of all HMDA-reportable loans. Approval rates for refinances increased by applicant income. Approval rates by applicant income were 26.2 percent for low income, 38.9 percent for moderate income, 48.4 percent for middle income, and 62.5 percent for upper income. When sorted by census tract income, approval rates for refinances were 19.9 percent in low-income tracts, 26.8 percent in moderate-income tracts, 46.7 percent in middle-income tracts, and 62.1 percent in upper-income tracts.
For all HMDA-reportable applications, approval rates for whites, blacks, and Hispanics were 66.5 percent, 41.8 percent, and 46.8 percent, respectively, in 1999; 67.1 percent, 47.5 percent, and 52.6 percent, respectively, in 2000; and 74.8 percent, 53.4 percent, and 57.1 percent in 2001, respectively.
For 1999, 2000, and 2001, low- and moderate-income applicants represented 37.5 percent, 37.0 percent, and 34.6 percent, respectively, of all reported HMDA applications for which applicant income was available, but only 30.4 percent, 32 percent, and 27.4 percent, respectively, of all reported HMDA originations for which applicant income was available.
In 1999, 2000, and 2001, financial institutions reported a total of 222,800 small-business loans originated in the Philadelphia, PA-NJ MA. This represented $9,515,054,000 in financing. Approximately 39.4 percent of the loans over the three years were made to businesses with gross annual revenues of $1 million or less, and 91.1 percent of the loans were for $100,000 or less.
In 1999, 2000, and 2001, financial institutions reported a total of 892 small-farm loans originated in the Philadelphia, PA-NJ MA. This represented $62,292,000 in financing. Approximately 80.5 percent of the loans over the three years were made to farms with gross annual revenues of $1 million or less, and 79.8 percent of the loans were for $100,000 or less.

Financial Institutions

In 2001, 678 lenders reported originating 209,851 HMDA-reportable loans totaling $24,392,931,000 in the Philadelphia, PA-NJ MA. Wells Fargo Home Mortgage, with 9,535 loans representing 4.5 percent of the market, had the most originations and also ranked first in total dollar amount with $1,566,807,000, representing 6.4 percent of the market.
In 2001, 357 lenders reported originating 20,349 HMDA-reportable loans totaling $1,075,564,000 in low- and moderate-income census tracts of the Philadelphia, PA-NJ MA. First Union National Bank, with 1,182 loans representing 5.8 percent of the market, had the most originations. Countrywide Home Loans ranked first in total dollar amount with $51,767,000, representing 4.8 percent of the market.
In 2001, 469 lenders reported originating 53,437 HMDA-reportable loans totaling $3,564,763,000 to low- and moderate-income borrowers in the Philadelphia, PA-NJ MA. Cendant Mortgage, with 2,506 loans representing 4.7 percent of the market, had the most originations and also ranked first in total dollar amount with $195,520,000, representing 5.5 percent of the market.
In 2001, 196 lenders reported originating 104,920 small-business loans totaling $4,257,841,000 in the Philadelphia, PA-NJ MA. GE Capital Financial, Inc., with 15,237 loans representing 14.5 percent of the market, had the most originations. First Union National Bank ranked first in total dollar amount with $898,209,000, representing 21.1 percent of the market.
In 2001, 100 lenders reported originating 11,849 small-business loans totaling $473,572,000 in low- and moderate-income census tracts of the Philadelphia, PA-NJ MA. GE Capital Financial, Inc., with 2,165 loans representing 18.3 percent of the market, had the most originations. First Union National Bank ranked first in total dollar amount with $118,994,000, representing 25.1 percent of the market.
In 2001, 22 lenders reported originating 290 small-farm loans totaling $26,608,000 in the Philadelphia, PA-NJ MA. First Union National Bank, with 87 loans representing 30 percent of the market, had the most originations and also ranked first in total dollar amount with $13,588,000, representing 51.1 percent of the market.

Community Organizations

The Philadelphia, PA-NJ MA has a number of organizations devoted to affordable housing for LMI families, economic development and job creation, and/or provision of social services to LMI households and families. The programs are outlined more fully in CHAPTER IV

Financing Programs

There are many public and private financing programs available for affordable housing and economic development that could be used in partnership to further goals for affordable housing and economic development. The programs are outlined more fully in CHAPTER V.

Chapter I: Demographics

Chapter II: HMDA and CRA Loan Data

Home Mortgage Disclosure Act (HMDA) Statement Data

An important source of information about financial institutions' lending patterns in a community is the Home Mortgage Disclosure Act (HMDA) statement. This report is submitted annually to the Federal Financial Institutions Examination Council (FFIEC) and is available to the public for each reporting institution. The types of loans that must be reported are home-purchase loans, for both owner-occupants and nonoccupants; refinancings; home-improvement loans; and loans for improvement and/or purchase of multifamily structures (five or more units). Depository institutions that had at least $32 million on December 31, 2001, and a home or branch office in an MA must file this report.

CRA Small-Business and Small-Farm Lending Data

Starting in 1996, the nation's financial institutions began reporting small-business and small-farm loans as part of their CRA disclosure statements required under the revised CRA regulations. While the information does not have the level of detail of the HMDA statements, it is an important source for understanding commercial lending activity in a community. The types of loans reported include all originations and purchases of commercial loans, lines of credit, and mortgages on nonresidential properties. The loans are reported by size, by geographic location, and for borrowers with annual revenues of $1 million or less. These categories of loans include those with guarantees, such as those provided by the SBA or USDA. Small-farm loans are reported in the same way.

Chapter III: Financial Institutions

Chapter IV: Community Organizations

This chapter of the community profile provides summaries of nonprofit organizations devoted to affordable housing, economic development, and provision of social services. Each organization listed includes Philadelphia PA-NJ MA in its service area. Inclusion here does not represent an unqualified endorsement of these organizations by the Federal Reserve Bank of Philadelphia. Rather, it suggests that a financial institution seeking to conduct outreach into the community consider approaching these organizations to determine mutual areas of interest and activity. The authors would like to express their thanks for the special assistance received from the Philadelphia Association of Community Development Corporations.

The organizations are arranged alphabetically by the type of activity.

Chapter V: Special Credit Enhancement/Financing Programs

This section of the profile contains a grid describing the many credit enhancement/financing programs available to area banks to provide financing for affordable housing, small businesses, and economic development. The grid is divided into geographically specific and regionally applicable programs as follows: National Credit Enhancement/Financing Programs; Pennsylvania Credit Enhancement/Financing Programs; and Philadelphia PA-NJ MA Credit Enhancement/Financing Programs.

Maps

Last update: February 2004