It’s true, women are better at paying their mortgages, despite imbalances ranging from the 26 percent gender wage gap to a lack of women in boardrooms and C-suites across America.
A new study from the Urban Institute reveals Women Are Better than Men at Paying Their Mortgages. The report describes that when examining loan performance for the first time by gender, women’s lower credit scores do not indicate weaker performances, and women actually perform better than men.
In some demographics women are even achieving homeownership at higher rates than men. In 2015, the homeownership rate of female householders in 1-person households was 24.56 percent higher than the homeownership rate of male householders in the same category, according to Census Bureau data on national household demographics.
How are women doing this? Through hard work, good planning, determination and sacrifice. Whether it’s time with family, preferred neighborhoods or dream homes, women do what it takes to achieve homeownership. And once they buy a home, women are better than men at keeping it.
- Single borrowers, particularly women, are more likely to be minorities: about 34.1 percent of female-only borrowers are minorities, compared with 32.1 percent of male-only borrowers, 22.4 percent of male-female borrowers, and 27.5 percent of female-male borrowers.
- Single borrowers, particularly women, are more likely to live in lower-income areas: 46.2 percent of female-only borrowers lived in lower-income census tracts, as did 44.7 percent of male-only borrowers.
- Single borrowers, particularly women, have higher mortgage rates: from 2004 to 2014, the average rate for female-only borrowers was 5.48 percent compared to 5.41 percent for male-only borrowers
- Single borrowers, particularly women, have lower incomes: the average income for female-only borrowers is $69,200, compared with $94,700 for male-only borrowers.
- Female-only borrowers actually default less than male-only borrowers: for mortgages originated from 2004 to 2007, the default rate for female-only borrowers was 24.6 percent, compared with 25.4 percent for male-only borrowers; from 2008-2010, the female-only default rate was again lower than the male-only rate (9.6 percent versus 9.7 percent). These same patterns are present in 2011-2014 data.
- Female-only borrowers own more of their homes than male-only borrowers: female-only borrowers have lower loan-to-value (LTV) ratios than male-only and female-male borrowers. The LTV for female-only borrowers is 75.07, versus 77.63 for male-only and 75.86 for female-male borrowers.
When addressing whether women are better than men at paying their mortgages, the report states, “Our results indicate the answer is a resounding yes: female performance is much stronger.” With their drive, determination and potential, women homebuyers are a valuable, emerging market. As women achieve equal resources and opportunities they will make their presence known in the housing market and economy.