Home Mortgage Research Articles

Home Mortgage Lending and Neighborhood Mental Health: A Spatial Econometric Analysis of 18 U.S. Metropolitan Statistical Areas.

This study investigates the relationship between home mortgages and neighborhood mental health across the 18 largest metropolitan statistical areas (MSAs) in the United States. Home mortgages, a primary avenue to homeownership, contribute to housing security and stability. Moreover, their issuance reflects local investment and potential improvements in the built environment, hypothesized to positively influence community mental well-being. Using census tract-level data from multiple sources, we employed a spatial econometric approach, specifically spatial error modeling, to account for spatial dependency and estimate the association between home mortgage lending (2011 to 2020) and the prevalence of self-reported poor mental health in 2020. Our findings indicate a statistically significant negative association between mortgage issuance and self-reported poor mental health across all 18 MSAs, suggesting that increased mortgage lending is associated with improved neighborhood mental health. Comparisons between standard linear models and spatial error models highlight the influence of unmeasured, spatially correlated factors on neighborhood mental health outcomes. This study underscores mortgage lending as a crucial factor in community well-being and emphasizes the necessity of addressing spatial dependency in neighborhood health studies for accurate estimations. The findings offer valuable insights for researchers and policymakers aiming to enhance community mental health and address health disparities through informed housing policies.

Real Estate Market Transformations Amidst Post-Pandemic Sino-U.S. Economic Trends

In the post-pandemic era, the global economic landscape has undergone profound changes. As the world’s largest economies, the economic policies and market performances of the United States and China have exerted far-reaching impacts on the global real estate market. This paper delves into the current state and future trajectory of the real estate market under Sino-U.S. economic trends, focusing on commercial real estate, residential investment, property taxes, financing, and laws and regulations. It also incorporates keywords such as easements, deed transfers, premium discount rates, home mortgages, police powers, liens, common law, fixtures, joint leases, marital property, private property, and trespassing to provide a comprehensive analysis.

Connecting Past to Present: Does Historical Redlining Affect Current Life Expectancy?

Previous research has documented a strong relationship between currently living in the redlined zones of the 1930s and suffering from a higher prevalence of disease. However, little is known about the relationship between historical redlining, modern-day redlining, and current resident health outcomes. This paper aimed to simultaneously model the associations between both historical redlining and modern-day redlining on current health outcomes. In this paper, we used structural equation modeling to uncover relationships between current and historical redlining practices and modern-day life expectancy, exploring two levels of potential mediating factors: (1) racial segregation and structural racism; and (2) mediating health outcomes. We analyzed data from 11,661 census tracts throughout the United States using historical redlining data from 1940, modern redlining data from 2010 to 2017, racial segregation and structural racism indices from 2010 to 2019, health outcome data from 2021 to 2022, and life expectancy data from 2010 to 2015. Historical redlining was measured using Home Owners' Loan Corporation (HOLC) ratings, which ranged from 1.0 for favorable neighborhoods ("greenlined") to 4.0 for unfavorable ("redlined") neighborhoods. Modern-day redlining was measured using Home Mortgage Disclosure Act (HMDA) data, which were transformed into four quartiles, ranging from level 1 (low mortgage rejection rates) to level 4 (high mortgage rejection rates). We found a significant relationship between historic redlining and current life expectancy, with average life expectancy decreasing steadily from 80.7 years in HOLC 1 tracts to 75.7 years in HOLC 4 tracts, a differential of 5.0 years between the greenlined and redlined tracts. We also found a significant relationship between modern-day redlining and current life expectancy, with average life expectancy decreasing steadily from 79.9 years in HMDA 1 tracts to 73.5 years in HMDA 4 tracts, a differential of 6.4 years. In the structural equation model, historical redlining had a total effect of decreasing life expectancy by 1.18 years for each increase of one in the HOLC rating. Modern-day redlining had a total effect of decreasing life expectancy by 1.89 years for each increase of one in the HMDA quartile. This paper provides new evidence that the legacy of redlining is not relegated to the history books but rather is a present and pressing public health issue today.

Consumers’ acceptance intention towards interest-free home financing: decomposition approach of TPB model

Purpose This paper aims to determine factors that contribute to consumers’ intention to opt for interest-free home financing or mortgage adapting decomposition approach of the theory of planned behaviour (TPB) model. Design/methodology/approach For this study, judgemental and purposive sampling was used and over 300 respondents who are using or willing to use equity-based Islamic mortgages were selected for analysis. Findings According to the findings of this study, consumers’ intention towards the interest-free mortgage is influenced primarily by their attitude, subjective norm and perceived behavioural control but also by the additional construct of their innovativeness of consumers as well as decomposed variables such as perceived relative advantage and perceived compatibility, but most importantly, peers. Overall, the study’s findings show that the suggested model clarifies a better knowledge of the factors that influence consumers’ choices to accept interest-free mortgage financing. Research limitations/implications Considering this research to be limited in terms of coverage geographically and the theory rendered the context should be given proper attention when interpreting future outcomes. Furthermore, future researchers can extend the direct relationship by using attitude as a mediator and also test adding a moderating variable when conducting a cross-sectional study. Originality/value This work is mainly focused on consumers’ intention to use Islamic mortgages. Current research incorporates and validates consumer innovativeness and introduces decomposed variables, namely, peers, perceived relative advantage and perceived compatibility to the TPB model. To the best of the authors’ knowledge, the decomposition of variables with the main predictors in the setting of an interest-free mortgage in Pakistan, the decomposition approach of the TPB model has not yet been attempted.

Methodologic Strategies for Quantifying Associations of Historical and Contemporary Mortgage Discrimination on Population Health Equity: A Systematic Review.

Mortgage discrimination refers to the systematic withholding of home mortgages from minoritized groups. In recent years, there has been an increase in empirical research investigating associations of historical and contemporary mortgage discrimination on contemporary outcomes. Investigators have used a variety of measurement methods and approaches, which may have implications for results and interpretation. We conducted a systematic review of peer-reviewed literature that has quantified links between both historical and current mortgage discrimination with contemporary adverse environmental, social, and health outcomes. Our goals were to document the methodology used to measure and assign mortgage discrimination, to assess implications for results and interpretation, and to make recommendations for future work. Following the Preferred Reporting Items for Systematic Reviews and Meta-Analysis guidelines, literature searches were conducted in September 2022 using terms that combined concepts of mortgage discrimination, health, and neighborhood environment. In total, 45 papers fit the eligibility criteria. In these, researchers investigated associations between mortgage discrimination and: (1) health outcomes (N = 28); (2) environmental and social exposures including heat, air pollution, greenspace, soil lead levels, and crime (N = 12); and (3) built environment features, including presence of retail alcohol, fast food, and tobacco stores (N = 5). Eleven included studies used Home Mortgage Discrimination Act (HMDA) data to identify racialized bias in mortgage discrimination or redlining, and 34 used Homeowner Loan Corporation (HOLC) maps. The construction and parametrization of mortgage discrimination or redlining and the spatial assignment of HOLC grades to contemporary addresses or neighborhoods varied substantially across studies. Results from our review suggest the need for careful consideration of optimal methods to analyze mortgage discrimination such as HOLC spatial assignment or HMDA index parametrization, contemplation of covariates, and place-based knowledge of the study location.

South Africa’s Housing Financialisation Crises and Social Resistance

The world’s most unequal country suffers from various housing crises, especially when it comes to excessive reliance upon a private sector prone to market failures, especially affordability. State housing finance strategy during the transition from apartheid to democracy relied upon augmentation of formal banking finance so as to promote home ownership. But as macro-economic conditions changed in the late 1980s, the resulting mass defaults on individual families’ home mortgage bonds led not only to foreclosures by a (white) state, but (black) working-class resistance organised by the country’s leading urban social movement, known as the ‘bond boycott.’ Even after democracy, a worsening housing backlog coincided with resurgence of household debt crises in the wake of the 2008 global financial meltdown. That generated a new housing finance strategy led by Mastercard and a local fintech firm (supported by the World Bank): collateralisation of welfare grants which in turn allowed debit orders for repayment of microfinance (typically used for minor home improvements). Again, social resistance played an important role, as the strategy caused even worse personal debt crises, and a welfare NGO’s successful fight to close Mastercard’s partner. But beyond periodic revolts of these sorts, a durable housing finance policy has remained elusive.

Still Separate, Still Not Equal: An Ecological Examination of Redlining and Racial Segregation with COVID-19 Vaccination Administration in Washington D.C.

Racial residential segregation has been deemed a fundamental cause of health inequities. It is a result of historical and contemporary policies such as redlining that have created a geographic separation of races and corresponds with an inequitable distribution of health-promoting resources. Redlining and racial residential segregation may have contributed to racial inequities in COVID-19 vaccine administration in the early stages of public accessibility. We use data from theNational Archives(historical redlining), Home Mortgage Disclosure Act (contemporary redlining), American Community Survey from 1940 (historical racial residential segregation) and 2015-2019 (contemporary racial residential segregation), and Washington D.C. government (COVID-19 vaccination administration) to assess the relationships between redlining, racial residential segregation, and COVID-19 vaccine administration during the early stages of vaccine distribution when a tiered system was in place due to limited supply. Pearson correlation was used to assess whether redlining and racial segregation, measured both historically and contemporarily, were correlated with each other in Washington D.C. Subsequently, linear regression was used to assess whether each of these measures associate with COVID-19 vaccine administration. In both historical and contemporary analyses, there was a positive correlation between redlining and racial residential segregation. Further, redlining and racial residential segregation were each positively associated with administration of the novel COVID-19 vaccine. This study highlights the ongoing ways in which redlining and segregation contribute to racial health inequities. Eliminating racial health inequities in American society requires addressing the root causes that affect access to health-promoting resources.

Increasing access, equitability, and rigor in the assessment of Neighborhood Mortgage Discrimination.

Mortgage discrimination alters the distribution of investment, opportunity, and economic advantage-key contributors of health disparities. Leveraging Home Mortgage Disclosure Act data, we assessed mortgage denial risk in 380 U.S. urban areas. We estimated the risks by census tract-relative to the urban-specific average-using a Bayesian spatial model with conditionally autoregressive distributions fitted with integrated nested Laplace approximation. This approach borrows information through spatial and non-spatial smoothing, resulting in stable estimates in the presence of sparse data. The method, publicly accessible, allows researchers to apply our approach, fostering deeper insights into mortgage lending discrimination and systematic neighborhood disinvestment.

Banking for the Culture: Black-owned banks as cultural assets during the subprime lending boom

Today, black-owned banks are important financial resources challenging economic exclusion. Nevertheless, they do not associate strongly with building black wealth. Some scholars argue this signals black-owned banks are ornamental, or ineffective responses to legacies of economic exclusion in black segregated neighborhoods. To engage these critiques, I draw on the dialectical theoretical frames of cultural assets and structural deficits to examine the effectiveness of black-owned banks during the subprime lending boom—a period when bank practices exploiting a history of economic exclusion in black segregated neighborhoods intensify. Specifically, I analyze administrative data from the Federal Deposit Insurance Corporation (FDIC) and the Home Mortgage Disclosure Act (HMDA) to assess whether black-owned banks associate with access to mortgage credit when the subprime lending boom peaks in 2006. Using propensity score matching with inverse probability weighting, I find black-owned banks do not associate with mortgage originations in 2006; but neighborhoods with black-owned banks receive fewer subprime mortgage loans, compared to matched ones without them. As such, black-owned banks appear to effectively shield black segregated neighborhoods from the time period's predation. Overall, findings imply black-owned banks support protective credit markets during periods of intensifying economic exclusion and exploitation.

Sistem Akuntansi Pemberian Kredit Agunan Rumah Dalam Mendukung Pengendalian Internal Pemberian Kredit

This research aims to explain and analyze how the Accounting System for Providing Home Collateral Credit at PT. Bank Tabungan Negara, Tbk Gorontalo Branch Office. The method used in the research is a qualitative descriptive review. PT. Bank Tabungan Negara, Tbk Gorontalo Branch Office has implemented an accounting system for granting home mortgage credit well and meets the internal control elements and is in accordance with established standards, and is supported by an E-Loan system which can provide convenience in the credit granting process and more effective and efficient credit decision making from the credit granting system.

Ethno-Racial and Credit Worthiness Disparities in Access to Mortgage Credit

Abstract The mortgage industry is central to ethno-racial stratification in homeownership access. Ample research demonstrates that unequal treatment of minorities has created major differences in the access and exclusion of low-cost loan products in the housing market. While numerous studies have documented the disadvantages Black and Latino homebuyers face, these studies have been limited in their assessment of credit worthiness in accessing a mortgage. This study draws on the annual dataset from the Home Mortgage Disclosure Act from 2018 and 2019 to assess ethno-racial disparities in mortgage outcomes by debt-to-income (DTI) levels. I demonstrate that DTI levels vary tremendously by ethno-racial groups. In addition, I show that loan rejections and high-cost loan originations are highest among Blacks and Latinos across DTI levels compared to White applicants. Depending on the adverse loan outcome, Asians perform similarly or slightly underperform compared to Whites. These trends are particularly true when examining high-cost loan originations as Blacks and Latinos with excellent credit worthiness perform similarly as Whites and Asians with below-average credit worthiness. Implications for ethno-racial stratification are discussed.

Protecting Home Loan Seekers in South Africa: Combating Unlawful Mortgage Lending Practices by Financial Institutions

All over the world, home loans and mortgages are part and parcel of the products and services being offered by the financial institutions-such as banks and homeowner mortgage institutions to their numerous customers. Prior, during and post home loan transactions, they owe their customers the duty to ensure full disclosure of all the terms and conditions in the mortgage agreements without withholding any information. This paper examines any act contrary to uberrimae fidei-utmost good faith in the transactions. Uberrimae fidei requires the highest standard of good faith on both the lender and borrower to disclose all material facts that could influence the decisions of the other party in seeking and granting home loans and mortgages. Failure might result in severe consequences by exploring both the civil and criminal responsibilities and liabilities of the party who acted mala fide-in bad faith. Against this backdrop, this paper examines the protection offered by the laws to ensure level playing field prior, during and after mortgage lending transactions.

Arbitrariness and Social Prediction: The Confounding Role of Variance in Fair Classification

Variance in predictions across different trained models is a significant, under-explored source of error in fair binary classification. In practice, the variance on some data examples is so large that decisions can be effectively arbitrary. To investigate this problem, we take an experimental approach and make four overarching contributions. We: 1) Define a metric called self-consistency, derived from variance, which we use as a proxy for measuring and reducing arbitrariness; 2) Develop an ensembling algorithm that abstains from classification when a prediction would be arbitrary; 3) Conduct the largest to-date empirical study of the role of variance (vis-a-vis self-consistency and arbitrariness) in fair binary classification; and, 4) Release a toolkit that makes the US Home Mortgage Disclosure Act (HMDA) datasets easily usable for future research. Altogether, our experiments reveal shocking insights about the reliability of conclusions on benchmark datasets. Most fair binary classification benchmarks are close-to-fair when taking into account the amount of arbitrariness present in predictions -- before we even try to apply any fairness interventions. This finding calls into question the practical utility of common algorithmic fairness methods, and in turn suggests that we should reconsider how we choose to measure fairness in binary classification.

Enhancing mortgage rate prediction: a comprehensive evaluation of computational statistical approaches

The noterate is a tool for predicting home mortgage rates, it is often skewed and has missing information. The noterate could be affected by incomplete or inaccurate data, thus leading to inaccurate predictions. Financial organizations including mortgage companies or banks need to consider the risk of uncertainty carefully and make a more accurate prediction based on some suitable models. To deal with this situation, in this paper we compared six computational statistical methods, including the ordinary least square model, maximum likelihood estimation, maximum a posterior, bootstrapping, Metropolis-Hastings, and Gibbs sampling method on a mortgage dataset. Based on the k fold cross-validation technique and four metrics including mean absolute error (MAE), mean squared error (MSE), root mean squared error (RMSE), and mean absolute percentage error (MAPE), the bootstrapping method outperforms other methods. In practice, this method is recommended for predicting noterate.

Racial and ethnic differences in the financial returns to home purchases

AbstractThe racial and ethnic composition of home buyers varies across geographic locations. Since home prices grow at different rates across counties and within counties, these place‐based bets yield different average rates of return for different demographic groups. I estimate these differential returns by combining micro data from Home Mortgage Disclosure Act (HMDA) with zip‐code‐level data from Zillow. Based on this index of housing returns from 2010 to 2022, I find that at the national level that Asian buyers earn higher returns than other groups. For California buyers and for Los Angeles buyers, Black people earn roughly the same average rate of return but face a higher standard deviation in returns than other groups.

Association of area-level mortgage denial and guideline-concordant non-small-cell lung cancer care and outcomes in the United States.

Racial and socioeconomic disparities in receipt of care for non-small-cell lung cancer (NSCLC) are well described. However, no previous studies have evaluated the association between mortgage denial rates and receipt of timely and guideline-concordant care for NSCLC and patient outcomes. We identified individuals ≥18 years diagnosed with NSCLC between 2014 and 2019 from the National Cancer Database. Using the Home Mortgage Disclosure Act database, we calculated the proportion of denied home loans to total loans at the zip-code level and categorized them into quintiles. Our outcomes included receipt of guideline-concordant care based on clinical and pathologic stage at diagnosis and the National Comprehensive Cancer Network guidelines, time from surgery to chemotherapy initiation, and overall survival. Of the 629,288 individuals diagnosed with NSCLC (median age 69; IQR 61-76 years, 49.1% female), 47.8% did not receive guideline-concordant care. Residing in areas with higher mortgage denial rates and lower income was associated with worse guideline-concordant care overall (aRR = 1.28; 95% CI = 1.25-1.32) and for each cancer treatment modality, worse receipt of timely chemotherapy (aHR = 1.14; 95% CI = 1.11-1.17) and worse overall survival (aHR = 1.21; 95% CI = 1.19-1.22), compared with residing in areas with the lowest mortgage denial rate and highest income. Area-level mortgage denial rate was associated with worse receipt of timely and guideline-concordant NSCLC care and survival. This highlights the critical need to understand and address systemic practices, such as mortgage denial, that limit access to resources and are associated with worse access to quality cancer care and outcomes.

Are younger buyers driving the housing boom? A geographic perspective on US home purchases, 2018-2021

ABSTRACT Rapid growth in US housing prices has coincided with the large Millennial demographic group reaching peak homebuying age, leading some to speculate that new demand from younger buyers is putting upward pressure on home prices. This Research Note uses data from the Home Mortgage Disclosure Act mortgage data to examine where younger buyers are purchasing homes. Data show that the share of buyers under age 35 fell in more than half of US counties, including 45% of metropolitan counties. A county- and MSA-level regression analysis finds a null or slightly negative correlation between changes in the share of buyers under age 35 and changes in home prices, and a small positive effect on debt-to-income ratios from 2018 to 2021, providing little to no evidence that young buyers are pushing up home prices.

Determinants of the millennial generation's intention to use Sharia home mortgages

A survey conducted by rumah.com showed that a notable number of participants, specifically 37 percent of those aged 22-29 and 36 percent of those aged 30-39, prefer Sharia mortgages to traditional ones. This research aims to explore the willingness of millennials to opt for Islamic housing loans, focusing on how their religious devotion influences this decision. The methodology of this study is quantitative, involving the distribution of questionnaires to 202 millennials. The gathered data underwent analysis using structural equation modeling (SEM-21) and SPSS 25. Findings from the study reveal that both the cost and the individual's earnings significantly encourage millennials to consider Islamic home loans, whereas their level of religious commitment does not play a crucial role. The study concludes that many millennials are inclined towards Sharia mortgages due to the fixed and extended period of repayments. Given their steady income, millennials find purchasing a home more appealing than renting, as owning a home offers a tangible asset that represents savings from their earnings.

New Results on the Disparities between Same-Sex and Different-Sex Couples in the Home Mortgage Market

New Results on the Disparities between Same-Sex and Different-Sex Couples in the Home Mortgage Market

How Age Shapes Ethno-Racial Disparities in Accessing Mortgage Credit

ABSTRACT Unequal homeownership access is a major component of ethno-racial stratification. Previous studies have demonstrated substantial ethno-racial disparities in access and outcomes throughout the homeownership process. In addition, prior research has assumed that mortgage applicants have a similar age distribution across ethno-racial groups. This paper draws on annual data from the 2018 and 2019 Home Mortgage Disclosure Act (HMDA) to assess variation in ethno-racial disparities in loan outcomes associated with different ages. I show that ethno-racial disparities in loan outcomes vary tremendously when considering the age of the applicant. I demonstrate that loan rejections and high-cost loan originations are highest among Latino and Black borrowers across age groups compared to Whites. Black borrowers have worse adverse loan outcomes than Whites, regardless of age. Depending on the adverse loan outcome, Asians perform similarly or underperform compared to Whites. In addition, older applicants are more likely to be denied a mortgage loan than younger applicants, while the trends for high-cost loans vary considerably across ethno-racial groups. When examining high-cost loan originations, Latinos above 65 years old (who are the best performing Latino sub-group) underperform Whites regardless of age.