Lending in the Dark: Local Newspaper Closures and Discrimination in Mortgage Lending

Tran Huynh (tran.huynh@durham.ac.uk)
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Tran Huynh: Durham University

No 2025-002, Jena Economics Research Papers from Friedrich-Schiller-University Jena

Abstract: This paper examines the extent to which local newspaper closures affect discrimination against minority borrowers in mortgage lending. I Ä„nd that following a newspaper closure, interest rate differentials between minority (black or Hispanic) and comparable non-minority borrowers increase by 5.5 basis points, widening the existing gap in mortgage outcomes between the two groups. This effect cannot be explained by differences in credit risk or underlying economic conditions. My Ä„ndings suggest that the local press plays an important role in monitoring lending practices and reducing information asymmetries in the mortgage market.

Keywords: lending; discrimination; minority; GSE mortgages; local newspapers (search for similar items in EconPapers)
JEL-codes: G21 J15 R31 (search for similar items in EconPapers)
Date: 2025-01-20
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