- redliner noun
Used by arrangement with John Wiley & Sons, Inc.
verb red·lined, red·lin·ing, red·lines verb, intransitive
- To refuse home mortgages or home insurance to areas or neighborhoods deemed poor financial risks.
- To reach the maximum engine speed at which an engine is designed to be safely operated: The car redlined at 80 miles per hour in fourth gear.
- Computer Science To mark or highlight edited text, as with a red line, to distinguish it from unedited portions of a document.
- To discriminate against by refusing to grant loans, mortgages, or insurance to.
- To remove from operational status because of mechanical defects or the need for scheduled maintenance: redlined three fighter aircraft.
- Computer Science To mark (edited text) by redlining.
- A safety limit, as marked on a gauge.
- Sports a. The red line at the center of an ice hockey rink, running parallel to the goal lines and dividing the rink in half.b. Either of two red lines running across an ice hockey rink near the end boards, in the center of which the goal is positioned.
redline - Business Definition
Is it illegal to redline? If so, are there any exceptions when it is legal?
Yes. Redlining—named for lenders who actually drew a red line around a neighborhood on a map, refusing mortgages to buyers in areas considered “risky"—is against the law. Banking practices received congressional scrutiny in the Fair Housing Act of 1968, which prohibited discrimination, and the Home Mortgage Disclosure Act of 1975, which required the release of data on bank lending. Unfortunately, despite these attempts to stop discriminatory practices, many believe that some lenders still deny mortgage loans based on the neighborhoods in which the applicants live
There are no exceptions by which redlining is statutorily legal, but some may argue that the current federal regulations are themselves a form of redlining. And others may argue that financial institutions have a right to stop lending mortgage money in, for example, a declining economic area or market environment. If a bank can show that a specific mortgage loan or that lending in a specific area will significantly and adversely affect its business opportunities or bottom line in the future, is that redlining or prudent financial investing?
Joan A. Koffman, Esq., Real Estate Attorney, Koffman & Dreyer, Newton, MA