Subprime mortgage lending in New York City: Prevalence and performance

Arbeitspapier

Subprime mortgage lending expanded in New York City between 2004 and mid-2007, and delinquencies on these subprime loans have been rising sharply. We use a rich, loan-level data set of the city's outstanding subprime loans as of January 2009 to describe the main features of this lending and to model the performance of these loans. These subprime loans represent a smaller share of total housing units in the city than is true nationwide. In addition, they are found to be clustered in neighborhoods where average borrower credit quality is low and, unlike prime mortgage loans, where African-Americans and Hispanics constitute relatively large shares of the population. We estimate a model of the likelihood that these loans will become seriously delinquent and find a significant role for credit quality of borrowers, debt-to-income and loan-to-value ratios at the time of loan origination, and estimates of the loss of home equity.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Staff Report ; No. 432

Classification and Topics

• Classification: Wirtschaft ; General Regional Economics (includes Regional Data) ; Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics
• Subject: New York City ; subprime lending ; Subprime-Hypothek ; New York (NY)

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Okah, Ebiere ; Orr, James
• Event: Veröffentlichung
• (who): Federal Reserve Bank of New York
• (where): New York, NY
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/60884
• Last update: 10.03.2025, 11:44 AM CET