Do Women Pay More for Mortgages?

Posted: 13 Oct 2011  

Ping Cheng

Florida Atlantic University - Finance

Zhenguo (Len) Lin

Hollo School of Real Estate, Florida International University

Yingchun Liu

Dept. of Finance, Insurance, Real Estate and Law, University of North Texas

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Date Written: October 11, 2011

Abstract

This paper documents women on average pay more for mortgages than men. The disparity cannot be fully explained by traditional variables such as mortgage features, borrower characteristics, and market conditions. While the persistence of gender disparity may suggest discrimination, we offer a different explanation: women pay higher rates because they are more likely to choose lenders by recommendation while men tend to search for the lowest rate. Our empirical test confirms that search effort is rewarded in marketplace, and suggests that gender disparity in mortgage rates may be addressed by policies aimed at improving women's financial literacy and search skills.

Keywords: Mortgage, Gender discrimination, Borrower behavior, Interest rates

Suggested Citation

Cheng, Ping and Lin, Zhenguo (Len) and Liu, Yingchun, Do Women Pay More for Mortgages? (October 11, 2011). Journal of Real Estate Finance and Economics, Vol. 43, No. 4, 2011. Available at SSRN: https://ssrn.com/abstract=1942424

Ping Cheng (Contact Author)

Florida Atlantic University - Finance ( email )

777 Glades Rd
Boca Raton, FL 33431
United States
561-297-3456 (Phone)
561-297-3686 (Fax)

Zhenguo Lin

Hollo School of Real Estate, Florida International University ( email )

University Park
11200 SW 8th Street
Miami, FL 33199
United States
3057799248 (Phone)

Yingchun Liu

Dept. of Finance, Insurance, Real Estate and Law, University of North Texas ( email )

1155 Union Circle #305340
Denton, TX 76203
United States

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