January 21, 2009


Last fall, a commenter here cited links to two academic journal articles showing higher mortgage default rates for blacks and Hispanics in the 1990s. Unfortunately, I didn't call attention to them at the time and now I can't find them. If you could repost them, I'd appreciate it.

My published articles are archived at iSteve.com -- Steve Sailer


Wink B said...

Meg Ryan is easier on the eyes than Sarah Jessica Parker. Some of the stars appear too Botoxed to manage understated facial expressions, but we don't live in an age of subtlety, so little is lost.

That was good, even for you.

Frank said...

I don't know if was me but here's one:


If can't get access to it here's the reference:

"Mortgage default rates and borrower race"Anderson, Richard, VanderHoff, James Journal of Real Estate Research, Sep/Oct 1999
"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."

I'll look for more.

Frank said...

Another article from Google Books from authors from the Federal Reserve:


Anonymous said...

Just search for "SSRN subprime" and take the econometric papers after 2005, and their references.
A good one is:


See section 5.3 on the effect of CRA. They also address what the lenders knew.

A very important paper on causes of the meltdown is Mian and Sufi:


Anonymous said...

Wink B,
"but we don't live in an age of subtlety, so little is lost."

Good one! What are the long term medical implications of Botox? Do you get a sagging ass or does your liver go wrong?

Frank said...

Google Scholar is a good resource for these kinds of searches.

DOI: 10.1111/j.1465-7295.2000.tb00009.x

On car loans:

Economic Inquiry
Volume 38 Issue 1, Pages 136 - 150
Published Online: 26 Mar 2007
Loan performance and race
RE Martin RC Hill


Recent studies find evidence of racial discrimination in mortgage markets. Although these studies explore loan approval rates for whites versus minorities, they do not specifically consider loan performance, either in the form of default rates or loan administration costs. This study considers discrimination in the used car credit market, where the collateral is not subject to location externalities, collateral value and quality do not vary as much as in real estate, and the loan terms are shorter. We find administration costs and default rates are higher for minorities than for whites, controlling for age, income, home ownership, wealth, occupation, loan terms, and geographic location."

On student loans, from Chronicle of Higher Ed:


"Among racial subgroups, black students defaulted at a rate five times that of white borrowers and nine times that of Asian borrowers. Hispanic students’ default rate was twice that of white students and four times that of Asian students."

The same study:http://www.educationsector.org/research/research_show.htm?doc_id=482682

Frank said...

from Gary Groton (Yale):


But it's mostly on data 2000-