Mortgage Default Rates and Borrower Race
11 Pages Posted: 10 Mar 2013
Date Written: September 1, 1999
Abstract
We estimate a mortgage default model with national data on conventional mortgages that were current from 1986 to 1992. Our analysis confirms the results of previous analyses of Federal Housing Authority mortgages: Black households have higher marginal default rates, controlling for differences in borrower and property characteristics. Further, we do not find that black borrowers have significantly more home equity. These results do not provide evidence of racial discrimination in mortgage lending and suggest that differences in default costs or transaction costs may explain differences in default rates.
Keywords: Discrimination, Lending, Mortgage, Race, Racial
JEL Classification: D90
Suggested Citation: Suggested Citation
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