Understanding foreclosures in Massachusetts
Ricardo Borgos,
Prabal Chakrabarti and
Julia Reade
No 2007-1, Public and Community Affairs Discussion Papers from Federal Reserve Bank of Boston
Abstract:
Recent increases in foreclosure rates in New England and other parts of the United States are raising concerns. Distressful for individual borrowers and potentially destabilizing for their communities, the negative effects of foreclosures flow beyond the impact on housing markets and the financial consequences for creditors. Public officials, lenders, current and potential homeowners, community organizations, and other stakeholders are paying careful attention. ; In low- and moderate-income communities in New England, community leaders view current trends as especially worrisome. Among possible explanations, they stress the expansion of high-cost and subprime lending in these communities; and they cite aggressive or unscrupulous mortgage practices, and even mortgage fraud. Historically, however, other factors have been responsible for foreclosure activity. Regional job losses, rising interest rates, weak housing markets, and stretched borrowers facing negative life events are among the factors that usually push up foreclosure rates. And even critics of current mortgage lending practices acknowledge that homeownership is an effective asset-building strategy and that expanding the availability of credit to previously underserved population groups is a worthy goal. ; This paper describes recent trends in New England foreclosure rates, discusses possible causes, and looks at the prevalence of foreclosures in Massachusetts cities and towns with significant populations of low- and moderate-income households. It finds that the prevalence of higher cost lending is associated with higher foreclosure rates.
Keywords: Mortgage loans - Massachusetts; Mortgage loans - New England; Foreclosure - Massachusetts; Foreclosure - New England (search for similar items in EconPapers)
Date: 2007
References: Add references at CitEc
Citations:
Downloads: (external link)
http://www.bostonfed.org/commdev/pcadp/2007/pcadp0701.pdf (application/pdf)
Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:fip:fedbpc:2007-1
Ordering information: This working paper can be ordered from
Access Statistics for this paper
More papers in Public and Community Affairs Discussion Papers from Federal Reserve Bank of Boston Contact information at EDIRC.
Bibliographic data for series maintained by Catherine Spozio ().