Document Type

Research Report

Publication Date



Five years ago, in response to numerous reports of the growth of predatory lending, both locally and nationwide, the Massachusetts Community & Banking Council (MCBC) – whose Board of Directors has an equal number of bank and community representatives – commissioned a study of subprime refinance lending in the city of Boston and surrounding communities. The resulting report, Borrowing Trouble? Subprime Mortgage Lending in Greater Boston, 1999, was the first detailed look at subprime lending in the city of Boston and in twenty-seven surrounding communities.

This is the sixth report in the annual series begun by that initial study. Geographic coverage has now expanded to include data on subprime lending in 108 individual cities and towns and the reports now cover subprime home purchase loans in addition to subprime loans made to refinance existing mortgages. This year’s report utilizes information on the pricing of high-cost subprime loans that became available for the first time in the Home Mortgage Disclosure Act data for 2004.

Responsible subprime lending can provide a useful service. Subprime lenders can do this by making credit available to borrowers otherwise unable to obtain it, while charging somewhat higher interest rates and fees that bear a reasonable relationship to the increased expenses and risks borne by the lender. There is, however, considerable evidence that much subprime lending does not satisfy this definition of responsibility.


A report prepared for the Massachusetts Community & Banking Council (MCBC).



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