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Limited liability, strategic default and bargaining power
Mozzanica, Mirco Balatti; López-Quiles, Carolina - 2021
default rates, renegotiation, or loan rates individually, we study them together as equilibrium outcomes of the strategic … interaction between lenders and borrowers. We present a simple model of default and renegotiation where the degree of limited … default rates and renegotiation rates. Regarding loan pricing, while the model predicts higher interest rates for limited …
Persistent link: https://www.econbiz.de/10012422423
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Subprime consumer credit demand : evidence from a lender's pricing experiment
Alan, Sule; Dumitrescu, Ruxandra; Lóránth, Gyöngyi - 2011
We test the interest rate sensitivity of subprime credit card borrowers using a unique panel data set from a UK credit card company. What is novel about our contribution is that we were given details of a randomized interest rate experiment conducted by the lender between October 2006 and...
Persistent link: https://www.econbiz.de/10008902391
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Consumer participation in the credit market during the COVID-19 pandemic and beyond
Charalambakis, Evangelos; Teppa, Federica; Tsiortas, … - 2024
This paper analyses the consumer's decision to apply for credit and the probability of the credit being accepted in the euro area during a period characterized by the unprecedented concomitance of events and changing borrowing conditions linked to the global COVID-19 pandemic and the Russian...
Persistent link: https://www.econbiz.de/10014507224
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Government loan guarantees, market liquidity, and lending standards
Ahnert, Toni; Kuncl, Martin - 2022
We study third-party loan guarantees in a model in which lenders can screen, learn loan quality over time and can sell loans before maturity when in need of liquidity. Loan guarantees improve market liquidity and reduce lending standards, with a positive overall welfare effect. Guarantees...
Persistent link: https://www.econbiz.de/10013342211
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Variation margins, fire sales, and information-constrained optimality
Biais, Bruno; Heider, Florian; Hoerova, Marie - 2018
Protection buyers use derivatives to share risk with protection sellers, whose assets are only imperfectly pledgeable because of moral hazard. To mitigate moral hazard, privately optimal derivative contracts involve variation margins. When margins are called, protection sellers must liquidate...
Persistent link: https://www.econbiz.de/10011921489
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Mortgage indebtedness and household financial distress
Georgarakos, Dimitris; Lojschova, Adriana; … - 2010
Using comparable survey data from twelve European countries from 1994 to 2001 we investigate households’ attitudes towards mortgage indebtedness. We find that a given debt burden creates much higher distress in countries with fewer mortgage holders relative to countries where a significant...
Persistent link: https://www.econbiz.de/10009640403
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Mortgage indebtedness and household financial distress
Georgarakos, Dimitris; Lojschova, Adriana; … - 2010
Using comparable survey data from twelve European countries from 1994 to 2001 we investigate households’ attitudes towards mortgage indebtedness. We find that a given debt burden creates much higher distress in countries with fewer mortgage holders relative to countries where a significant...
Persistent link: https://www.econbiz.de/10003971055
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Borrowing constraints, own labour and homeownership : does it pay to paint your walls?
Lindner, Peter; Mathä, Thomas; Pulina, Giuseppe; … - 2020
Using a dedicated set of questions in the 2014 Luxembourg Household Finance and Consumption Survey (LU-HFCS), we show that a substantial share of households contributes their own labour to the acquisition of their main residence. These contributions help households faced with credit constraints,...
Persistent link: https://www.econbiz.de/10012299081
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Trust and the household-bank relationship
Ampudia, Miguel; Palligkinis, Spyros - 2018
We examine the role of trust in households' decisions to hold a bank account and to switch to a new bank. We explore Italian household-level data that contain restricted information on the banks that the households are doing business with, as well as measures of trust in the households' main...
Persistent link: https://www.econbiz.de/10011920967
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Financial inclusion : what's it worth?
Ampudia, Miguel; Ehrmann, Michael - 2017
This paper studies the determinants of being unbanked in the euro area and the United States as well as the effects of being unbanked on wealth accumulation. Based on household-level data from the euro area Household Finance and Consumption Survey and the U.S. Survey of Consumer Finance, it...
Persistent link: https://www.econbiz.de/10011635258