Publications
Publications
- 2022
The Impact of Minority Representation at Mortgage Lenders
By: W. Scott Frame, Ruidi Huang, Erik J. Mayer and Adi Sunderam
Abstract
We study links between the labor market for loan officers and access to mortgage credit. Using novel data matching the (near) universe of mortgage applications to loan officers, we find that minorities are significantly underrepresented among loan officers. Minority borrowers are less likely to complete mortgage applications, have completed applications approved, and to ultimately take-up a loan. These disparities are significantly reduced when minority borrowers work with minority loan officers. Minority borrowers working with minority loan officers also have lower default rates. Our results suggest that minority underrepresentation among loan officers has adverse effects on minority borrowers’ access to credit.
Keywords
Household Finance; Demographic Economics; Financial Institutions; Diversity; Prejudice and Bias; Mortgages; Banking Industry
Citation
Frame, W. Scott, Ruidi Huang, Erik J. Mayer, and Adi Sunderam. "The Impact of Minority Representation at Mortgage Lenders." NBER Working Paper Series, No. 30125, June 2022.