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Economic Factors Affecting Home Mortgage Disclosure Act Reporting

Posted: 15 Nov 2007  

Michael LaCour-Little

Federal National Mortgage Association (Fannie Mae); California State University at Fullerton

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The release of the 2004-2005 Home Mortgage Disclosure Act data raised a number of questions given the increase in the number and percentage of higher-priced home mortgage loans and continued differentials across demographic groups. This paper assesses three possible explanations for the observed increase in 2005 over 2004: (1) changes in lender business practices; (2) changes in the risk profile of borrowers; and (3) changes in the yield curve environment. Results suggest that after controlling for the mix of loan types, credit risk factors, and the yield curve, there was no statistically significant increase in reportable volume for loans originated directly by lenders during 2005, though indirect, wholesale originations did significantly increase. The findings also reveal that the market price of risk increased by about 15 basis points in 2005 versus 2004, implying that mortgage costs increased for all borrowers on a risk-adjusted basis.

Keywords: Home Mortgage Disclosure Act, HMDA, home loan, credit risk, yield curve

JEL Classification: R11, R14, R21, R31, R38

Suggested Citation

LaCour-Little, Michael, Economic Factors Affecting Home Mortgage Disclosure Act Reporting. Journal of Real Estate Research, Vol. 29, No. 4, 2007. Available at SSRN:

Michael LaCour-Little (Contact Author)

Federal National Mortgage Association (Fannie Mae) ( email )

3900 Wisconsin Avenue, NW
Washington, DC 20016-2892
United States
202-752-3318 (Phone)

California State University at Fullerton ( email )

5133 Mihaylo Hall
Fullerton, CA 92834-6848
United States
657-278-4014 (Phone)
657-278-2161 (Fax)

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