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Financially constrained borrowers have the incentive to influence the appraisal process in order to increase borrowing or reduce the interest rate. We document that the average valuation bias for residential refinance transactions is above 5%. The bias is larger for highly leveraged...
Persistent link: https://www.econbiz.de/10010703331
interaction with both banks and consumers. We synthesize the insights it provides into two domains: credit supply and payment and …
Persistent link: https://www.econbiz.de/10012837335
We study a controlled experiment in which a bank's loan officers were incentivized based on originated loan volume to encourage prospecting for new business. While treated loan officers did attract new applications, both extensive and intensive margins of loan origination expanded ( 31% new...
Persistent link: https://www.econbiz.de/10009625941
Financially constrained borrowers have the incentive to influence the appraisal process in order to increase borrowing or reduce the interest rate. We document that the average valuation bias for residential refinance transactions is above 5%. The bias is larger for highly leveraged...
Persistent link: https://www.econbiz.de/10013065882
Financially constrained borrowers have the incentive to influence the appraisal process in order to increase borrowing or reduce the interest rate. We document that the average valuation bias for residential refinance transactions is above 5%. The bias is larger for highly leveraged...
Persistent link: https://www.econbiz.de/10013071769
This paper uses a data set from a leading American subprime lender, which contains detailed information on borrower and loan characteristics. We find that financial professionals are less likely to become delinquent. This effect cannot be explained by borrower characteristics, such as income,...
Persistent link: https://www.econbiz.de/10012964804
This paper uses a dataset from one of the leading subprime lenders in America, containing detailed information on borrower and loan characteristics, finds that borrowers from the financial industry, who have higher financial literacy, are less likely to default. This effect cannot be explained...
Persistent link: https://www.econbiz.de/10012971816
We document that increasing penalties for default reduces strategic default in financial crises by exploiting the 2009 changes to Canadian consumer insolvency regulations. Our novelty is that the incentives from increasing penalties for default operate in the opposite direction from incentives...
Persistent link: https://www.econbiz.de/10013321871
Institutions often offer a menu of contracts to consumers in an attempt to create a separating equilibrium that reveals borrower types and provides better pricing. We test the effectiveness of a specific set of contracts in the mortgage market: mortgage points. Points allow borrowers to exchange...
Persistent link: https://www.econbiz.de/10011962222
-committee districts. In these areas, banks delayed the start of the foreclosure process by 0.5 months (relative to the 12-month average … Political Action Committees of the largest mortgage servicing banks to the committee members in that period and is comparable to … these banks' lobbying expenditures …
Persistent link: https://www.econbiz.de/10011968870