In this paper we examine the relationship between homeowners' bankruptcy decisions and their mortgage default decisions … mortgages. Bankruptcy and foreclosure similarly may be either substitutes or complements. In fact we show that both … foreclosure rates raise homeowners' probability of foreclosure. We provide estimates of the size of these effects …

We assess the credit market impact of allowing mortgage "strip-down"--that is, reducing the principal of underwater … provided by a series of U.S. Circuit Court of Appeals decisions in the early 1990's that introduced mortgage strip-down in … Court decision led to a short-term reduction of 3% in mortgage interest rates and a short-term increase of 1% in mortgage …

How much of the recent rise in foreclosures can be explained by the large number of high-leverage mortgage contracts … originated during the housing boom? We present a model where heterogeneous households select from a set of mortgage contracts and … choose whether to default on their payments given realizations of income and housing price shocks. The set of mortgage …

bust and to analyze foreclosure mitigation policy. We consider a dynamic search model in which foreclosures freeze the … the model fit both national and cross-sectional moments better than a model without foreclosure. When calibrated to the …

functions. We measure the impact of foreclosures on new mortgage lending using a panel of all B&Ls in 4 states. The foreclosure …Foreclosures led to severe disruptions in home mortgage lending during the recent Great Recession and the Great … overhang explains about 30 percent of the drop in new mortgage lending by B&Ls as the housing crisis intensified between 1930 …

Federal mortgage modification initiatives, targeting millions of borrowers, are intended to prevent foreclosures of … possibility that the former would be a more durable foreclosure prevention tool. The programs also impose marginal income tax …

This paper takes a skeptical look at a leading argument about what is causing the foreclosure crisis and distills some … mortgage and the lender's subsequent choice whether to renegotiate or "modify" the loan. The theoretical model and econometric … analysis illustrate that "unaffordable" loans, defined as those with high mortgage payments relative to income at origination …

mortgage default factors associated with the economic cycle, such as negative equity, completely account for the foreclosure … reinterpretation of the U.S. foreclosure crisis as more of a prime, rather than a subprime, borrower issue. Moreover, traditional …

distortions in the supply of mortgage credit, evidenced by a decoupling of credit flow from income growth, may have caused the … rise in house prices and the subsequent housing market collapse. This paper shows that the increase in mortgage … to earlier years. We show that the relation between individual mortgage size and income growth during the housing boom …