Mortgage supply and the US Housing boom : the role of the Community Reinvestment Act

Vahid Saadi

This paper studies the role of the Community Reinvestment Act (CRA) in the US housing boom-bust cycle. I find that the enhancement in CRA enforcement in 1998 increased the growth rate of mortgage lending by CRA-regulated banks to CRA-eligible census tracts. I show that during the boom period house price growth was higher in the eligible census tracts because of the shift in mortgage supply of regulated banks. Consequently, these census tracts experienced a worse housing bust. I find that CRA-induced mortgages went to borrowers with lower FICO scores and encountered more frequent delinquencies.

MoreLess

Year of publication:	[2019] ; This version: October 2019
Authors:	Saadi, Vahid
Publisher:	Frankfurt am Main : SAFE, Sustainable Architecture for Finance in Europe
Subject:	The Community Reinvestment Act \| Mortgage supply \| House prices \| Homeownership \| Hypothek \| Mortgage \| Immobilienpreis \| Real estate price \| USA \| United States \| Niedrigeinkommen \| Low income \| Wohneigentum \| Wohnungsmarkt \| Housing market \| Kreditpolitik \| Credit policy

freely available

Full text |

More access options

doi.org

Check Google Scholar

In German libraries (KVK)

I need help

Extent:	1 Online-Ressource (circa 80 Seiten) Illustrationen
Series:	SAFE working paper. - Frankfurt am Main : SAFE, ZDB-ID 2745463-0. - Vol. no. 155
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Graue Literatur ; Non-commercial literature ; Arbeitspapier ; Working Paper
Language:	English
Other identifiers:	10.2139/ssrn.2877609 [DOI] hdl:10419/206684 [Handle]
Classification:	G28 - Government Policy and Regulation ; G21 - Banks; Other Depository Institutions; Mortgages ; R21 - Housing Demand ; R31 - Housing Supply and Markets
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10012122488