Skip to Content
Streetsblog USA home
Streetsblog USA home
Log In
Streetsblog.net

Why Don’t Mortgage Lenders Account for Transportation Costs?

Every house or apartment comes with an embedded cost: transportation. Depending on the location and local infrastructure, those costs can be very small or very large.

false

There's a good deal of evidence that transportation expenses can have a direct impact on mortgage loan defaults. Shane Phillips at Network blog Better Institutions says banks should consider these costs when assessing risk and assigning a mortgage rate.

It seems to follow that since walkable, mixed-use communities tend to have lower foreclosure rates, they should also be eligible for lower mortgage interest rates. Fewer people defaulting on their home loans means fewer losses to account for, so the profit that banks need to earn on each individual mortgage can be lower. In turn, those lower rates would increase the appeal of choosing safer, healthier, more sustainable communities in which to live (i.e., walkable urbanism / smart growth).

Advocacy's great -- necessary, even -- but nothing would make the case for urban living like a 3.00% mortgage interest rate.

That means Fannie Mae and Freddie Mac -- government backed mortgages -- need to be at least as available in walkable urban neighborhoods as they are in sprawling ones. On the private side, Phillips says, lenders need to be sophisticated enough to tell the difference between the two.

Elsewhere today: Twin City Sidewalks offers reasons why cyclists sometimes don't stop at stop signs. The Political Environment says a sagging bridge in Green Bay tells the story of the Scott Walker administration's backward infrastructure spending priorities. And Bike Delaware has photos of flooded bike infrastructure in Boulder, Colorado.

Stay in touch

Sign up for our free newsletter

More from Streetsblog USA

USDOT Secretary Sean Duffy Is Dead Wrong About Bike Lanes

The Secretary of Transportation says he hasn't seen enough data to believe in the benefits of bike lanes. So we put together an explainer help him out — mostly using information from his own department.

April 25, 2025

Friday Video: Check Out Lorde On a Bike!

The Kiwi singer is on the top of the charts — and in our bike-riding hearts.

April 25, 2025

Friday’s Headlines Dodge Death

Thankfully, traffic deaths have started to fall. But cars and drivers are still killing too many people. Why?

April 25, 2025

Breaking: US DOT is Coming For America’s ‘DEI’ Dollars, Threatening ‘Sanctuary’ Cities With Pulled Funds

Advocates are raising the alarm about yet another vague and disturbingly broad letter from Sean Duffy — and the fierce battle that's likely to follow it.

April 24, 2025
See all posts