Subprime Mortgage Pricing: The Impact of Race, Ethnicity, and Gender on the Cost of Borrowing

The subprime lending boom increased the ability of many Americans to get credit to purchase a house. Yet concerns persist that not all borrowers have been treated equally. Previous research suggests that subprime loans were particularly concentrated in neighborhoods with a high concentration of black and Hispanic residents (Mayer and Pence 2007). Some commentators have been concerned that minority borrowers were steered into subprime loans in some cases when they might have qualified for cheaper conforming loans or that minority borrowers were given subprime loans that had fees or rates that were too high.