Regressive Mortgage Credit Redistribution in the Post-crisis Era

64 Pages Posted: 4 Sep 2016 Last revised: 1 Jun 2017

See all articles by Francesco D'Acunto

Francesco D'Acunto

Boston College

Alberto Rossi

University of Maryland - Department of Finance

Date Written: May 31, 2017


We document that, since 2011, mortgage lenders reduced credit to middle-class households by 15% and increased credit to wealthy households by 21%. Credit to low-income households was unaffected. Results hold at the individual-loan level and zip-code level, and at the intensive margin and extensive margin. The redistribution increased monotonically with the size of the lender. The collapse of the private-label securitization market, banks’ risk-management concerns, wealth polarization, post- crisis policies of GSEs, or pre-crisis indebtment are unlikely to explain the results. The results appear consistent with large banks reacting more to the increased costs of origination imposed by financial regulation.

Keywords: Mortgage Market, Financial Crisis, Dodd-Frank, Income Inequality

JEL Classification: D78, D92, G18, G21, G23, H32, K22

Suggested Citation

D'Acunto, Francesco and Rossi, Alberto, Regressive Mortgage Credit Redistribution in the Post-crisis Era (May 31, 2017). Robert H. Smith School Research Paper No. RHS 2833961. Available at SSRN: or

Francesco D'Acunto

Boston College ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States

Alberto Rossi (Contact Author)

University of Maryland - Department of Finance ( email )

Robert H. Smith School of Business
Van Munching Hall
College Park, MD 20742
United States

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