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Macroeconomic-Driven Prepayment Risk and the Valuation of Mortgage-Backed Securities

Chernov, Mikhail - 2016

We introduce a reduced-form modeling framework for mortgage-backed securities in which we solve for the implied … actual prepayments, providing direct evidence of significant prepayment risk premia in mortgage-backed security prices. We … risk. We also find evidence that mortgage-backed security prices were significantly affected by Fannie Mae credit risk and …

Persistent link: https://www.econbiz.de/10012456578

How Do Americans Repay Their Debt? The Balance-Matching Heuristic

Gathergood, John - 2019

In Gathergood et al. (2019), we studied credit card repayments using linked data on multiple cards from the United Kingdom. We showed that individuals did not allocate payments to the higher interest rate card, which would minimize the cost of borrowing, but instead made repayments according to...

Persistent link: https://www.econbiz.de/10012479511

Macroeconomic Effects of Debt Relief : Consumer Bankruptcy Protections in the Great Recession

Auclert, Adrien - 2019

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 significantly smaller declines in non-tradable...

Persistent link: https://www.econbiz.de/10012479637

Designed to Fail : Effects of the Default Option and Information Complexity on Student Loan Repayment

Cox, James C. - 2018

We ask why so few student loan borrowers enroll in Income Driven Repayment when the majority would benefit from doing so. To do so we run an incentivized laboratory experiment using a facsimile of the government's Student Loan Exit Counseling website. We test the role information complexity,...

Persistent link: https://www.econbiz.de/10012480909

Minimum Payments and Debt Paydown in Consumer Credit Cards

Keys, Benjamin J. - 2016

Using a dataset covering one quarter of the U.S. general-purpose credit card market, we document that 29% of accounts regularly make payments at or near the minimum payment. We exploit changes in issuers' minimum payment formulas to distinguish between liquidity constraints and anchoring as...

Persistent link: https://www.econbiz.de/10012455938

Improving Household Debt Management with Robo-Advice

Chak, Ida; Croxson, Karen; D'Acunto, Francesco; Reuter, … - National Bureau of Economic Research - 2022

Poor debt-management skills lower financial security and wealth accumulation. Because optimal solutions to credit repayment problems depend on neither risk preferences nor beliefs, loan repayment is a prime application for robo-advising. Vulnerable households, though, tend to distrust new...

Persistent link: https://www.econbiz.de/10013462665

Debt Moratoria : Evidence from Student Loan Forbearance

Dinerstein, Michael; Yannelis, Constantine; Chen, Ching-Tse - National Bureau of Economic Research - 2023

We evaluate the effects of the 2020 student debt moratorium that paused payments for student loan borrowers. Using administrative credit panel data, we show that the payment pause led to a sharp drop in student loan payments and delinquencies for borrowers subject to the debt moratorium, as well...

Persistent link: https://www.econbiz.de/10014287348

Mortgage Prepayment and Path-Dependent Effects of Monetary Policy

Berger, David W. - 2018

depends not just on their current level but also on their previous path. Using a household model of mortgage prepayment …

Persistent link: https://www.econbiz.de/10012480809

Mortgage Timing

Koijen, Ralph S.J. - 2007

exhibits a surprising amount of time variation. A simple utility framework of mortgage choice points to the bond risk premium … confirm empirically that the bulk of the time variation in household mortgage choice can be explained by time variation in the … mortgage choice, thereby lending further credibility to a theory of strategic mortgage timing by households …

Persistent link: https://www.econbiz.de/10012465289

Payment Size, Negative Equity, and Mortgage Default

Fuster, Andreas - 2013

Surprisingly little is known about the importance of mortgage payment size for default, as efforts to measure the …

Persistent link: https://www.econbiz.de/10012459316

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