The Role of Technology in Mortgage Lending

Clicks: 35
ID: 301754
2019
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Abstract
Technology-based ("FinTech") lenders increased their market share of U.S. mortgage lending from 2% to 8% from 2010 to 2016. Using loan-level data on mortgage applications and originations, we show that FinTech lenders process mortgage applications 20% faster than other lenders, controlling for observable characteristics. Faster processing does not come at the cost of higher defaults. FinTech lenders adjust supply more elastically than do other lenders in response to exogenous mortgage demand shocks. In areas with more FinTech lending, borrowers refinance more, especially when it is in their interest. We find no evidence that FinTech lenders target borrowers with low access to finance. Received June 1, 2017; editorial decision November 5, 2018 by Editor Wei Jiang. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.
Reference Key
openalex_W2943908192 Use this key to autocite in the manuscript while using SciMatic Manuscript Manager or Thesis Manager
Authors Andreas Fuster, Matthew Plosser, Philipp Schnabl, James Vickery
Journal review of financial studies
Year 2019
DOI
10.1093/rfs/hhz018
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