Here are two things that are true:
- Women are better at paying off mortgages than are men.
- Women pay more for mortgages than men with similar credit profiles.
It might not make sense, but it is true nonetheless. A new report from the Urban Institute notes that banks often change women significantly higher interest rates than men when they borrow money to purchase a home, despite the fact that women tend to default on their loans less than men. “This is the first step in saying the barometer is consistently not accurately predicting whether women are able to pay their mortgages,” says Sheryl Pardo, a spokesperson for the Housing Finance Policy Center at the Urban Institute.
The Urban Institute study looked at all types of borrowers, including single men, single women, and couples. They compared data from 13 million women and 17 million men across a vast range of socioeconomic factors. They found that “if a male-only (most likely a single man) borrower has a 6% probability of default, a female-only (most likely a single woman) borrower with the same characteristics would be expected to default at a 5.8% rate,” according to the study.
That means women are .2% better at not missing payments. And there are a lot of them out there: the Urban Institute study also found that single women are now the second-largest group of buyers in the marketplace, accounting for anywhere from 15 percent to more than 20 percent of all home purchases in recent years. Single men, by contrast, have accounted for about nine percent of purchases since 2012.
And yet the Urban Institute isn’t the only study to find this kind of discrimination: a recent Woodstock Institute research report found significant gender disparities across all purchase and refinance mortgages at several major banks.
At Avrus Financial and Mortgage, we believe in taking an individual approach to finding the right mortgage lender for the right borrower, regardless of gender. We’ve helped hundreds of women secure the right mortgage at the right rate, and we can help you, too.
Why not ask us how… today?
