Does marriage equality promote credit access? Evidence from same-sex marriage laws

• DOI: 10.1016/j.jcorpfin.2022.102315
• Publication Date: 2022-11-12T01:50:31Z
• Authors: Jens Hagendorff; Duc Duy Nguyen; Vathunyoo Sila
• Keywords: 330; mortgages; same-sex marriage; 0502 economics and business; 05 social sciences; 1. No poverty; banks

We show that following the legalization of same-sex marriage across US states, mortgage applications from same-sex borrowers are more likely to be denied relative to a matched sample of different-sex borrowers. Our findings are robust to using a stacked regression design and several approaches to account for compositional changes in the pool of mortgage applicants around same-sex legalization. FinTech lenders, which rely less on human loan officers, experience no change in the denial gap. Our results highlight information frictions between loan officers and same-sex borrowers as one channel for the increased denial gap between same-sex and different-sex applications.