RACIAL,ECONOMIC, AND INSTITUTIONAL DIFFERENCES IN HOME MORTGAGE LOANS: St. Joseph County,Indiana

ABSTRACT: Numerous studies have documented racial and economic disparities in the home mortgage market. Almost all of these have been done in large urban areas, many of which have long histories of racial conflict and discrimination. Further, little attention has been paid to institutional disparities, i.e., the ways in which mortgage lenders differ among themselves in their community reinvestment performance. In this study, we profile the home mortgage lending of several institutions doing business in the medium-sized urban area of St. Joseph County, Indiana. We find tremendous differences between lenders, suggesting that bank practices and policies exert a great impact on how well low income and minority neighborhoods and individuals are served. Lender characteristics, such as the legal structure of the institution (e.g., commercial bank, credit union, savings and loan), branch locations, and other factors are associated with these disparities. We conclude by suggesting that several heretofore ignored variables need closer examination.