Mortgage Lending in Chicago and Los Angeles: A Paired Testing Study of the Pre-Application Process

Stephen Ross, Margery Austin Turner, Erin Godfrey and Robin R. Smith
Additional contact information
Margery Austin Turner: Metropolitan Housing and Communities Policy Center, Urban Institute
Erin Godfrey: New York University
Robin R. Smith: Metropolitan Housing and Communities Policy Center, Urban Institute

No 2005-03, Working papers from University of Connecticut, Department of Economics

Abstract: This paper analyzes data from a recently completed study of discrimination against African-American and Hispanic homebuyers when they visit mortgage lending institutions in two major metropolitan markets to make pre-application inquiries. It represents the first application of paired testing to rigorously measure discrimination in the mortgage lending process. The paired tests isolated significant levels of differential treatment on the basis of race and ethnicity in Chicago with African Americans and Hispanics receiving less information and assistance than comparable whites. Adverse treatment of African-Americans and Hispanics is also observed in Los Angeles for specific treatments, but the overall pattern of treatment observed did not differ statistically from equal treatment. Multivariate analyses for Chicago indicate that large lenders treat minorities more favorably than small lenders and that lenders with substantial numbers of applications from African-Americans treat African Americans more favorably than lenders with predominantly white application pools.

JEL-codes: G21 J15 L85 R30 (search for similar items in EconPapers)
Pages: 56 pages
Date: 2005-02
New Economics Papers: this item is included in nep-fin, nep-geo and nep-ure
References: View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Mortgage lending in Chicago and Los Angeles: A paired testing study of the pre-application process (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:uct:uconnp:2005-03

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