Risk versus Demographics in Subprime Mortgage Lending: Evidence from Three Connecticut Cities

Risk versus Demographics in Subprime Mortgage Lending: Evidence from Three Connecticut Cities This paper analyzes patterns in subprime residential mortgage lending using 2006 Home Mortgage Act Disclosure data for the cities of Bridgeport, New Haven and Waterbury, Connecticut. The analysis applies models presented in earlier research and has the objective of assessing the relative importance of demographic versus risk factors in subprime mortgage lending decisions. Regression equations are estimated for census tracts and individual borrowers and include demographic variables and property risk measures. The results find race and ethnicity to be significant determinants of subprime lending in the borrower equations that include the full set of risk measures. Neighborhood educational levels are found to have an inverse and often significant association with subprime mortgage loans. Property risk measures present mixed results regarding their significance in subprime lending, suggesting that risk may have played less of a role in loan originations in 2006 than it did in earlier studies. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png The Journal of Real Estate Finance and Economics Springer Journals

Risk versus Demographics in Subprime Mortgage Lending: Evidence from Three Connecticut Cities

Loading next page...
 
/lp/springer_journal/risk-versus-demographics-in-subprime-mortgage-lending-evidence-from-tZMNUBLWKb
Publisher
Springer US
Copyright
Copyright © 2010 by Springer Science+Business Media, LLC
Subject
Economics; Regional/Spatial Science; Financial Services
ISSN
0895-5638
eISSN
1573-045X
D.O.I.
10.1007/s11146-010-9281-0
Publisher site
See Article on Publisher Site

Abstract

This paper analyzes patterns in subprime residential mortgage lending using 2006 Home Mortgage Act Disclosure data for the cities of Bridgeport, New Haven and Waterbury, Connecticut. The analysis applies models presented in earlier research and has the objective of assessing the relative importance of demographic versus risk factors in subprime mortgage lending decisions. Regression equations are estimated for census tracts and individual borrowers and include demographic variables and property risk measures. The results find race and ethnicity to be significant determinants of subprime lending in the borrower equations that include the full set of risk measures. Neighborhood educational levels are found to have an inverse and often significant association with subprime mortgage loans. Property risk measures present mixed results regarding their significance in subprime lending, suggesting that risk may have played less of a role in loan originations in 2006 than it did in earlier studies.

Journal

The Journal of Real Estate Finance and EconomicsSpringer Journals

Published: Sep 25, 2010

References

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 12 million articles from more than
10,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Unlimited reading

Read as many articles as you need. Full articles with original layout, charts and figures. Read online, from anywhere.

Stay up to date

Keep up with your field with Personalized Recommendations and Follow Journals to get automatic updates.

Organize your research

It’s easy to organize your research with our built-in tools.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve Freelancer

DeepDyve Pro

Price
FREE
$49/month

$360/year
Save searches from
Google Scholar,
PubMed
Create lists to
organize your research
Export lists, citations
Read DeepDyve articles
Abstract access only
Unlimited access to over
18 million full-text articles
Print
20 pages/month
PDF Discount
20% off