Resum:
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In this paper, we investigate whether evidence of discriminatory treatment against immigrants in
the Spanish mortgage market exists. More specifically, we test whether, ceteris paribus,
immigrant borrowers tend to be charged with higher interest rates on their mortgages than their
Spanish born counterparts. To do so, we use a unique dataset on granted mortgages that contains
information not only regarding the conditions of the loan but also the socio-economic
characteristics of the mortgagors. We observe that immigrants are systematically charged with
higher interest rates. We apply the well known Oaxaca-Blinder decomposition to measure the
extent to which this disparate treatment of lenders in mortgage pricing against immigrants is due
to discrimination. Our results indicate that approximately two thirds of the gap in the interest
rate between Spanish born and immigrant borrowers can be attributed to discriminatory
treatment.
Key words: Immigration, discrimination, mortgage pricing, housing market.
JEL codes: R21, G21, J14 |