The Concentration of Financial Disadvantage: Debt Conditions and Credit Report Data in Massachusetts Cities and Boston Neighborhoods
Credit report data reveal large disparities in credit scores, debt collection rates, and other measures of financial distress across cities in Massachusetts and among Boston neighborhoods. For example, half of consumers in Springfield, Lawrence, and the Boston neighborhoods of Roxbury and Mattapan have subprime credit scores, compared to just 8 percent in Newton and the Beacon Hill neighborhood. About 1 in 3 residents of Roxbury and Mattapan have debt collections on their credit reports, compared to just 5 percent in several higher-income Boston neighborhoods.
Since credit report information influences future access to credit, lending terms, and other outcomes, the concentration of financial disadvantage can further exacerbate inequality between residents across cities and neighborhoods. Credit and debt measures contribute a unique and important perspective on the financial conditions of communities that cannot be fully captured by traditional socioeconomic measures such as income and poverty levels.
KEY FINDINGS
Credit report data reveal large disparities in credit scores, debt collection rates, and other measures of financial distress across cities in Massachusetts and among Boston neighborhoods. For example, half of consumers in Springfield, Lawrence, and the Boston neighborhoods of Roxbury and Mattapan have subprime credit scores, compared to just 8 percent in Newton and the Beacon Hill neighborhood. About 1 in 3 residents of Roxbury and Mattapan have debt collections on their credit reports, compared to just 5 percent in several higher-income Boston neighborhoods.
Since credit report information influences future access to credit, lending terms, and other outcomes, the concentration of financial disadvantage can further exacerbate inequality between residents across cities and neighborhoods. Credit and debt measures contribute a unique and important perspective on the financial conditions of communities that cannot be fully captured by traditional socioeconomic measures such as income and poverty levels.