Immigrants and Mortgage Delinquency

38 Pages Posted: 20 Jan 2016

See all articles by Zhenguo (Len) Lin

Zhenguo (Len) Lin

Florida International University (FIU) - Hollo School of Real Estate

Yingchun Liu

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

Jia Xie

Government of Canada - Bank of Canada

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Date Written: Spring 2016

Abstract

This article studies the effect of immigrant status on mortgage delinquency. Due to their different social and economic background, immigrant households may not integrate well into the host society, and therefore are more likely to be delinquent on mortgages than otherwise identical native‐born households. We test this hypothesis by comparing the mortgage delinquency rate between immigrant and native‐born households in the 2009 PSID (Panel Study of Income Dynamics) data, in which all the immigrant households have been in the United States for more than 10 years. We find that, after controlling for observables, those relatively recent immigrants who have been in the United States for 10 to 20 years have a higher mortgage delinquency rate than native‐born, while immigrants who have resided in the United States for more than 20 years are no different from native‐borns. In addition, there is no evidence that the second generation of immigrants is more likely to be delinquent than the third‐or‐higher generations. Our results are robust to potential sample‐selection bias and functional misspecifications.

Suggested Citation

Lin, Zhenguo and Liu, Yingchun and Xie, Jia, Immigrants and Mortgage Delinquency (Spring 2016). Real Estate Economics, Vol. 44, Issue 1, pp. 198-235, 2016, Available at SSRN: https://ssrn.com/abstract=2718683 or http://dx.doi.org/10.1111/1540-6229.12092

Zhenguo Lin (Contact Author)

Florida International University (FIU) - Hollo School of Real Estate ( email )

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

Jia Xie

Government of Canada - Bank of Canada ( email )

234 Wellington Street
Ontario, Ottawa K1A 0G9
Canada

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