NEW YORK — Mortgage defaults stem from loan products not income level, according to a study released last week by the Local Initiatives Support Corp. The study also found that most subprime mortgages were made outside of poverty-stricken areas.
Delinquency and foreclosure rates for subprime borrowers were comparable across all income levels, according to Michael Rubinger, LISC president/CEO.
"This reinforces what years of experience have already told us: low-income residents are not, by definition, poor credit risks. Unsuitable mortgage products are," he said.
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