You’ve heard it a million times — life’s just not fair. Yuck. And a brand-new 270-page study undertaken for the US Department of Housing and Urban Development (HUD) confirms that in the world of mortgage lending life is in fact not fair. The study, which looked at over 8,000 mortgages, concluded that minorities and less-educated borrowers paid more than white or college-educated borrowers. In fact, those with college degrees paid over $1,000 less for their mortgages than those with no college education.

Sarah E. Woodward, the author of the study and formerly an economist with HUD, speculated that this is due to lenders assuming that educated or white borrowers were more likely to shop around and to understand what the going rates for mortgages in their areas were. So they got better quotes from the get-go.

But borrowers don’t need to just take it. College degree or not, you are anonymous when you are online. No one giving you a rate quote knows what your education is, or your race, or if you prefer dogs to cats. What lenders can assume is that you are savvy enough to do your research online and that you are obviously shopping–both reasons for them to offer up their best when you ask for a quote.

This entry was posted on Friday, May 30th, 2008 at 2:41 pm and is filed under Daily Pick. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.