The Vulnerability of Minority Homeowners in the Housing Boom and Bust

This paper examines mortgage outcomes for a large sample of individual home purchases and refinances linked to credit scores in seven major US markets. Among those with similar credit scores and loan attributes, black and Hispanic homeowners had much higher rates of delinquency and default in the do...

Full description

Saved in:
Bibliographic Details
Published in:American economic journal. Economic policy 2016-02, Vol.8 (1), p.1-27
Main Authors: Bayer, Patrick, Ferreira, Fernando, Ross, Stephen L.
Format: Article
Language:English
Subjects:
African Americans
Credit scoring
Criminality
Economic conditions
Hispanic Americans
Home financing
Home ownership
Homeowners
Housing
Loans
Markets
Racial inequality
Wealth
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:This paper examines mortgage outcomes for a large sample of individual home purchases and refinances linked to credit scores in seven major US markets. Among those with similar credit scores and loan attributes, black and Hispanic homeowners had much higher rates of delinquency and default in the downturn. These estimated differences are especially pronounced for loans originated near the peak of the housing boom. These findings suggest that black and Hispanic homeowners drawn into the market near the peak were especially vulnerable to adverse economic shocks and raise concerns about homeownership as a mechanism for reducing racial disparities in wealth.
ISSN:1945-7731
1945-774X
DOI:10.1257/pol.20140074