Mortgage Default Rates and Borrower Race

Richard Anderson () and James VanderHoff ()
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Richard Anderson: Jersey City State College 2039 Kennedy Boulevard, Jersey City, NJ 07305-1597, http://www.njcu.edu/
James VanderHoff: Rutgers University-Newark Newark, NJ 07102, http://www.rudgers.edu/

Journal of Real Estate Research, 1999, vol. 18, issue 2, pages 279-290

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.

JEL-codes: L85 (search for similar items in EconPapers)
Date: 1999
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