---
license: cc-by-4.0
language: [en]
tags: [finance, mortgage, fha, hmda, fair-lending, denial-rates, variance-decomposition]
pretty_name: FHA Door Effect 2025 — Lender-Attributable Variation in Denial Outcomes
---

# The Door Effect (2025): Lender Identity and FHA Denial Outcomes

**38% of the explainable variation in 2025 FHA mortgage-denial outcomes is associated with
lender identity — not the applicant's file.** McFadden pseudo-R² rises from **0.171**
(applicant/loan characteristics only) to **0.276** when lender fixed effects are added,
on **859,090 decisioned FHA applications** from the complete public CFPB HMDA 2025 record.

## Files
- `door_effect_summary_2025.csv` — headline decomposition metrics with definitions
- `overlay_residuals_2025.csv` — top-15 strictest and top-15 most-lenient large lenders:
  actual vs mix-predicted denial rates; residual in percentage points (largest: +43.7pp)
- `reason_fingerprints_context.json` — denial-reason mix context for residual interpretation

## Method (short)
Denominator rule: decisioned applications = action_taken ∈ {1,2,3}; denial = action 3;
FHA = loan_type 2. Model A: logistic denial ~ income, loan amount, LTV band, DTI band,
property type, state FE. Model B: Model A + lender (LEI) FE. Door-effect share =
(R²_B − R²_A) / R²_B. Full methodology: https://financeratecalc.com/door-effect.html

## Use boundary (read before use)
**Associational, not causal.** HMDA contains no credit scores; the residual means
"not explained by observable federal-record characteristics." **Never use this data for
individual approval prediction, borrower profiling, or personalized lender recommendation.**
A lender's historical aggregate is not any person's probability.
Machine-readable claim passport & contract:
https://financeratecalc.com/claims/door-effect-38pct-2026.json

## Provenance & citation
First published August 2026 by FinanceRateCalc (independent research, Ziya Yetiş).
Cite: "FinanceRateCalc analysis of the public CFPB HMDA 2025 record; historical aggregate only."
Related paper: SSRN 7156938 (AI-accuracy benchmark) · Working paper: The Door Effect (2026).
License: CC BY 4.0.