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Refinancing Trends among Lower Income and Minority Homeowners during the Housing Boom and Bust

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  • Ryan M. Goodstein

Abstract

type="main"> This article examines trends in mortgage refinancing activity during the housing boom and bust, with a focus on homeowners in lower income and minority market (LIMM) areas. Unlike any other period in recent history, during the boom LIMM homeowners refinanced their mortgages more frequently than non-LIMM homeowners. This occurred primarily among borrowers for whom the refinance option was not in-the-money, and it is likely attributable to the concurrent growth of subprime, cash-out refinancing. Following the 2007 mortgage market collapse, however, LIMM homeowners were less likely to refinance. This can be explained in part by systematic differences in home equity levels across borrowers.

Suggested Citation

  • Ryan M. Goodstein, 2014. "Refinancing Trends among Lower Income and Minority Homeowners during the Housing Boom and Bust," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 42(3), pages 690-723, September.
    • Handle: RePEc:bla:reesec:v:42:y:2014:i:3:p:690-723
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    File URL: http://hdl.handle.net/10.1111/1540-6229.12032
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    2. Saty Patrabansh, 2015. "The Marginal Effect of First-Time Homebuyer Status on Mortgage Default and Prepayment," FHFA Staff Working Papers 15-02, Federal Housing Finance Agency.

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