Mortgage cramdown enabled bankruptcy judges to discharge the underwater portion of a mortgage during Chapter 13 … bankruptcy before the Supreme Court disallowed this practice in 1993. We exploit the random assignment of cases to judges to … quantify the ex-post effects of Chapter 13 bankruptcy over the period from 1989 to 1993. We find that a successful Chapter 13 …

This paper argues that the debt forgiveness provided by the U.S. consumer bankruptcy system helped stabilize employment … levels during the Great Recession. We document that over this period, states with more generous bankruptcy exemptions had …-post debt forgiveness provided by the consumer bankruptcy system during the Great Recession increased aggregate employment by …

A more generous consumer bankruptcy system provides greater insurance against financial risks, but it may also raise … the cost of credit to consumers. We study this trade-off using the 2005 Bankruptcy Abuse Prevention and Consumer … Protection Act (BAPCPA), which raised the costs of filing for bankruptcy. We identify the effects of BAPCPA on borrowing costs by …

The 2005 Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) is the most important reform of personal … bankruptcy in the United States in recent years. This legislation overhauled eligibility requirements and increased monetary … costs of filing for bankruptcy. Using administrative credit file data from a nationally representative panel, we quantify …

This paper examines how filing for bankruptcy under Chapter 13 helps financially distressed debtors save their homes …. We develop a model of debtors' decisions to default on their mortgages and file for bankruptcy under Chapter 13 and … evaluate the model using new data on Chapter 13 bankruptcy filers. We also examine the effect of allowing bankruptcy judges to …

market innovations which cause a decrease in the transactions cost of lending and a decline in the cost of bankruptcy can … largely accounting for the rise in consumer bankruptcy. We also argue that the abolition of usury laws and other legal changes …

From 1980 to 2004, the number of personal bankruptcy filings in the United States increased more than five-fold, from … 288,000 to 1.5 million per year. Lenders responded to the high filing rate with a major lobbying campaign for bankruptcy … reform that led to the adoption in 2005 of the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA), which made …

decision variables, such as financial benefit from filing for bankruptcy, or debt discharged in bankruptcy are endogenous with … the bankruptcy decision or not. For the strategic timing theory such decisions are endogenous, while for the adverse … are exogenous with the bankruptcy decision, consistent with the adverse events theory …