The authors' simple model of the mortgage underwriting process provides a framework within which to define discrimination and various notions of the default rate. By providing those with differing views a common framework for discussing their positions, the model clarifies and reconciles some of...

Since 1970, housing finance has undergone a radical transformation due to the securitization of mortgage loans. As the market for mortgage securities continues to grow and develop, this transformation raises a number of important public policy issues.

Mortgage interest rates now move much more closely with capital market rates than in the past. This important development stems in part from the removal of mortgage usury ceilings. But the main reason for the closer relationship of mortgage rates to capital market rates is growth of the...