Which practice involves denying loans to minority groups trying to purchase homes in predominantly white neighborhoods?

Redlining refers to the practice of denying loans or insurance to individuals based on their race or the racial composition of their neighborhood. This term originated from the color-coded maps used by banks and insurers in the mid-20th century, where areas predominantly inhabited by minorities were marked in red, indicating that they were deemed too risky for mortgage lending or insurance services. Consequently, this practice systematically excluded minority groups from homeownership opportunities in majority-white neighborhoods, reinforcing segregation and economic disparity.

The other options, while related to housing discrimination, do not specifically describe the practice of denying loans based on racial factors. Blockbusting, for example, involves the illegal practice where real estate agents might encourage white homeowners to sell their properties at a low price by instilling fear that minorities will move in, subsequently selling those properties at a higher price to minority buyers. Steering refers to guiding potential home buyers towards or away from certain neighborhoods based on their race. Discrimination is a broader term that encompasses various forms of biased treatment but does not specifically address the loan denial aspect of redlining.