Found this quote from the Harvard study entitled “Understanding Mortgage Market Behavior: Creating Good Mortgage Options For All Americans” by Ren S. Essene and William Apgar. (pdf docucment)
Peter D. Hart Research Associates and the Coldwater Corporation. 2002. The Growing Demand for Housing: 2002 Fannie Mae National Housing Survey. Fannie Mae Foundation. This study found that over half of all African-American and Hispanic borrowers erroneously believed that lenders are required by law to provide the best possible loan rates.
Another quote from the Harvard study–
“Despite the benefits of the new mortgage market, there are nevertheless reasons for concern. For example, the recent rise in mortgage delinquencies and foreclosures suggests that some households are taking on debt that they have little or not capacity to repay. Alternatively, there is growing evidence that many families are taking out mortgages that they do not understand or that are not suitable for their needs.”
Hat tip: Understanding Markets
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