Table 4.
Excess Foreclosure Filings and Home Equity Threatened Due to Cumulative Disadvantage in Baltimore
| Entered Foreclosure | ||||||||
|---|---|---|---|---|---|---|---|---|
| N | Observed | Predicted | Excess Difference | Total Foreclosure Filings | Excess Foreclosure Filings | Mean Home Equity Threatened | Total Excess Home Equity Threatened | |
| Black Borrowers (vs. White Borrowers) | ||||||||
| All Black Borrowers | 1,196 | 17.9% | 10.4% | 7.5% | 214 | 90 | $41,848 | $3,766,304 |
| Borrower Income over $50,000 | 661 | 19.4% | 7.7% | 11.6% | 128 | 77 | $38,317 | $2,950,383 |
| Private Label Securitization Loans | 814 | 23.0% | 13.8% | 9.2% | 187 | 75 | $40,583 | $3,043,762 |
| All Borrowers in Black Tracts (vs. All Borrowers in White Tracts) | ||||||||
| All Borrowers in Black Tracts | 1,421 | 15.4% | 11.4% | 4.0% | 219 | 57 | $44,851 | $2,556,518 |
| Borrower Income over $50,000 | 816 | 15.6% | 10.0% | 5.6% | 127 | 46 | $42,488 | $1,954,464 |
| Private Label Securitization Loans | 897 | 21.3% | 15.3% | 6.0% | 191 | 54 | $41,927 | $2,264,033 |
| Black Borrowers in Black Tracts (vs. White Borrowers in White Tracts) | ||||||||
| Black Borrowers in Black Tracts | 962 | 17.2% | 9.3% | 7.9% | 165 | 76 | $46,521 | $3,535,592 |
| Borrower Income over $50,000 | 506 | 18.8% | 7.8% | 11.0% | 95 | 55 | $43,268 | $2,379,763 |
| Private Label Securitization Loans | 655 | 22.0% | 12.3% | 9.7% | 144 | 63 | $44,179 | $2,783,276 |
| Black Borrowers in White Tracts (vs. White Borrowers in White Tracts) | ||||||||
| Black Borrowers in White Tracts | 234 | 20.9% | 12.8% | 8.1% | 49 | 19 | $26,465 | $502,843 |
| Borrower Income over $50,000 | 155 | 21.3% | 11.7% | 9.6% | 33 | 15 | $24,362 | $365,426 |
| Private Label Securitization Loans | 159 | 27.0% | 17.3% | 9.8% | 43 | 16 | $26,557 | $424,917 |
| White Borrowers in Black Tracts (vs. White Borrowers in White Tracts) | ||||||||
| White Borrowers in 50%-100% Black Tracts | 262 | 10.7% | 6.8% | 3.9% | 28 | 10 | $36,094 | $360,937 |
| Borrower Income over $50,000 | 198 | 10.1% | 6.3% | 3.8% | 20 | 8 | $35,475 | $283,802 |
| Private Label Securitization Loans | 128 | 19.5% | 12.7% | 6.9% | 25 | 9 | $30,750 | $276,750 |
Note: White tracts label refers to 0%-50% black tracts and black tracts label refers to 50%-100% black tracts. The predicted foreclosure rates are average adjusted predictive margins based on what rates among corresponding borrowers for each row in the table would experience given observed characteristics along with predicted monthly loan payments and predicted probabilities of receiving a combined risk loan had they received equal treatment as similarly situated borrowers in the comparison group in parentheses. Home equity at time of foreclosure calculated for all borrowers who ever entered a foreclosure using information on combined loan-to-value ratio at origination, monthly payment, interest rate and amortization schedule, adjustable rate resets, interest only amortization, and zip code home price change (appreciation/depreciation in underlying property value). Equity is diminished by accrued interest for deliquent loans and calculated using the actual current balance recorded by the latest monthly update to the mortgage-backed securities files; mean home equity includes borrowers with negative equity. For a small number of loans the actual current deliquent balance is estimated by assuming 120 days delinquent for loans entering foreclosure, consistent with average timeline of judicial foreclosure in Maryland during the period of study. Average adjusted predictive margins estimations exclude 6 borrowers who received loan modifications and also entered foreclosure. See text for further explanation.