Subprime Cities: The Political Economy of Mortgage Markets presents a collection of works from social scientists that offer insights into mortgage markets and the causes, effects, and aftermath of the recent 'subprime' mortgage crisis. Provides an even-handed and detailed analysis of mortgage markets and the recent housing crisis Features contributions from various social scientists with expertise in critical social theories who have assembled and analyzed detailed empirical information Offers a unique and powerful rebuttal to many of the misleading popular explanations of the crisis and its aftermath Reveals how racial minorities and the neighbourhoods inhabited by them are more likely to be targeted by subprime and predatory lenders

Subprime Cities: The Political Economy of Mortgage Markets presents a collection of works from social scientists that offer insights into mortgage markets and the causes, effects, and aftermath of the recent 'subprime' mortgage crisis. Provides an even-handed and detailed analysis of mortgage markets and the recent housing crisis Features contributions from various social scientists with expertise in critical social theories who have assembled and analyzed detailed empirical information Offers a unique and powerful rebuttal to many of the misleading popular explanations of the crisis and its aftermath Reveals how racial minorities and the neighbourhoods inhabited by them are more likely to be targeted by subprime and predatory lenders

Subprime mortgage lending expanded in New York City between 2004 and mid-2007, and delinquencies on these subprime loans have been rising sharply. The authors describe the main features of this lending and model the performance of these loans. These subprime loans 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. The authors 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. Illus.

Over the past decade, a new mortgage market offering loans at low interest rates and for little or no money down has given low-income people an opportunity to pursue the American dream of homeownership. The resulting wave in home buying promised to stabilize neighborhoods and families, boost the economy, and reduce crime. In many ways, the optimists were correct, but now, less than fifteen years later, the subprime mortgage market is collapsing, threatening to take the rest of the housing sector along with it.Subprime Mortgages: America's Latest Boom and Bust analyzes how the subprime market emerged, why it is in crisis, and how we can reform public policy to avert disaster. An attendant examination of the rental market also offers recommendations for shoring up what may be the best housing option for some families.

Analyzes the impact of the subprime mortgage crisis on urban neighborhoods in Mass. Explores the topic using a data set that matches race and income info. with property-level, transaction data. Much of the subprime lending in the state was concentrated in urban neighborhoods and that minority homeownerships created with subprime mortgages have proved exceptionally unstable in the face of rapid price declines. Subprime lending did not, as commonly believed, lead to a substantial increase in homeownership by minorities but instead generated turnover in properties owned by minority residents. The particularly dire foreclosure situation in urban neighborhoods actually makes it somewhat easier for policymakers to provide remedies. Illus.

Subprime lending serves those with relatively high credit risk and therefore entails higher borrowing costs. This market has grown tremendously over the past decade, although with substantial variation in growth rates across the central cities of metropolitan areas in the US. Previous research has focused on specific cities and has shown that subprime lending historically occurs disproportionately in areas with higher risk, lower income and larger shares of minority households. This paper extends the literature by conducting a nation-wide study of how subprime lending patterns have changed over time across all US central cities. We find subprime lending growth is higher in urban census tracts with higher percentages of Hispanic population, lower levels of educational attainment, and, ceteris paribus, higher median family incomes.

The rise in subprime and predatory lending has put many families and neighborhoods in financial jeopardy as default and foreclosure rates skyrocket, particularly in minority and low-income areas. Reform of predatory lending practices is a necessary first step, but a comprehensive approach must take into account the connections between the evolution of financial services and rising inequality, particularly as they affect mortgage lending in the United States. Ameliorating inequities in the provision of financial services is unlikely without addressing the structural sources of inequality. Public policies and private practices have shaped the uneven development of metropolitan areas, and alternative policies and practices can ameliorate those patterns.