We use individual-level mortgage application data to empirically test for scale economies in neighborhood lending, and find evidence of significant economies associated with the scale of operation of individual lenders in a neighborhood. The inability to exploit these economies of scale is found...

In many metropolitan areas (MSAs) newspapers post mortgage terms for lenders in a manner designed to permit an easy comparison of discount points and note rates. Using these advertised rates for 73 lenders in three MSAs we examine 1) how applicants respond to short-run changes in relative rates,...