Working Paper Real Denial Rates
A Better Way to Look at Who Is Receiving Mortgage Credit
Laurie Goodman, Bing Bai, Wei Li
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This paper updates the current denial rate for mortgages using the real denial rate (RDR) methodology developed in 2014. The RDR improves on the traditional denial rate measurement because it takes into account the differences in credit worthiness among borrowers. Accordingly, our RDR more accurately reveals the current levels of mortgage credit accessibility. Our updated results show that conventional mortgages have higher denial rates than government mortgages, racial and ethnic differences are smaller than the traditional denial rate method indicates but are not eliminated, and small-dollar mortgages have significantly higher real denial rates, particularly in the government loan channel.
Research Areas Wealth and financial well-being Race and equity Housing finance
Tags Asset and debts Racial and ethnic disparities Single-family finance Homeownership Financial products and services Wealth inequality Inequality and mobility Finance Racial homeownership gap
Policy Centers Housing Finance Policy Center