The rejection rate for blacks dropped to 40.71 percent in 1999 from 44.57 percent in 1998, while the denial rate for Hispanics dropped to 41.67 percent from 44.83 percent, according to the study by the Association of Community Organizations for Reform Now, or ACORN. Nationally, loan rejection rates showed similar declines in the last year.
The report also stated one in three black and Hispanic applicants in Dallas were rejected for loans, compared with one in four white applicants.
Still, the study reported that more than half of black applicants and one-third of Hispanic applicants were denied conventional mortgage loans.
"We're still in trouble," said Liz Wolff, an ACORN spokeswoman. "Given how good the economy is and how many people are working, the fact that there is still so many African-Americans and Latinos being denied loans and still being steered to FHA lending, we're not narrowing the homeownership gap.
"If we're not doing it now," she added, "when are we going to do it?"
But numbers don't tell the full story, said James Ballentine, director of the American Bankers Association's Center for Community Redevelopment.
"The data don't show the credit levels and histories," he said. "Without that information, it's difficult to determine if discrimination played a role in the rejections."
He pointed out that homeownership for all groups is at record levels.
Without standardizing data for income, minorities will have higher rejection rates because, in general, they have lower incomes, said Bernard Weinstein, director of the Center for Economic Development and Research at the University of North Texas in Denton.
"When it comes to getting ... mortgages approved or credit cards, home equity loans or car loans, people with low incomes are turned down more frequently than people with higher incomes," he said.
Nationwide, 53.75 percent of blacks were denied loans in 1999, compared with 38.63 percent of Hispanics and 27.44 percent of whites. In 1998, 58.1 percent of blacks, 42.19 percent of Hispanics and 27.85 percent of whites were denied.
Put another way, blacks were denied 1.96 times more often than whites in 1999, compared with 2.09 times more often in 1998. Hispanics were denied 1.4 times more often in 1999, and 1.51 times more often in 1998.
Despite the drop in rejection rates overall, the disparity between black and white homebuyers widened in some of the nation's biggest cities with large black populations, such as Oakland, Detroit and Washington, the study reported. In those areas, blacks were 2.23 times more likely to be denied loans than white applicants â€“ an increase from 1998's 2.16 figure.
ACORN didn't study cities with large Hispanic populations, Ms. Wolff said.
In the report, ACORN used numbers reported to the Federal Financial Institutions Examinations Council, an agency that compiles lending data to comply with the Home Mortgage Disclosure Act data. To determine local lending rates, the study evaluated loans made in 50 Metropolitan Statistical Areas nationwide.
The Dallas metropolitan area includes Collin, Dallas, Denton, Ellis, Henderson, Hunt, Kaufman and Rockwall counties.
In the Fort Worth-Arlington metropolitan area â€“ Hood, Johnson, Parker and Tarrant counties â€“ rejections for loans decreased more for minorities than for whites. The white rejection rate fell 8.6 percent, while the black rejection rate fell 12.1 percent â€“ the fourth-largest decrease among the 50 metropolitan areas â€“ and the Hispanic rejection rate fell 9.6 percent.
The Houston metropolitan area â€“ Chambers, Fort Bend, Harris, Liberty, Montgomery and Waller counties â€“ showed a similar pattern. The rejection rate for white applicants fell 3.8 percent, while the rate for blacks and Hispanics fell 4 percent and 5.1 percent, respectively.
The Austin-San Marcos metropolitan area, which includes Bastrop, Caldwell, Hays, Travis and Williamson counties, was the second-worst place in the nation for Hispanics to get mortgage loans. Their loan applications were 2.34 times more likely to be rejected than those of whites. Only Springfield, Mass., where Hispanics were 2.61 times more likely to be rejected, was higher.
In 1999, 73 percent of white families owned their homes, compared with 47 percent of black families and 45 percent of Hispanic families, according to the ACORN study.