Summary of Credit Availability and the Decline in Mortgage Lending to Minorities after the Housing Boom

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The American Dream, of which home ownership is one critical component, is increasingly out of reach for many US citizens. Just prior to the onset of the 2008 financial crisis, home ownership rates began falling for minority borrowers, particularly for African-American and Hispanic individuals. After the housing bubble implosion, ownership rates among minorities have fallen even more precipitously. While many politicians argue this dynamic may have a racial component, economists Neil Bhutta and Daniel Ringo contend that credit conditions provide a more plausible scenario. getAbstract recommends this concise and analytical report for its detailed examination of the current state of home lending to and borrowing by minorities.

In this summary, you will learn

  • Why home ownership rates fell for US minorities between 2006 and 2014,
  • How credit conditions may have affected the dynamic, and
  • Why borrower credit quality may explain the numbers.

About the Authors

Neil Bhutta is a principal economist at the Federal Reserve Board of Governors, where Daniel Ringo is an economist.



The US residential mortgage market since the Great Recession is considerably weaker than it was during the boom years that fueled the ranks of home ownership. Yet for minorities – specifically African-American and Hispanic individuals – the drop-off in ownership rates began in 2006 and fell considerably through 2014. The data indicate that during that period, Hispanic “market shares of owner-occupied home purchase loans” fell from almost 12% to 8%, and the African-American percentage fell from more than 8% to slightly below 6%. Contrast...

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