, the reverse occurs. Based on these insights, I consider a foreclosure reform that makes all mortgages full recourse, and I … constraints. During housing busts, longer selling times spill over into higher foreclosure risk, thereby magnifying the response …

, the reverse occurs. Based on these insights, I consider a foreclosure reform that makes all mortgages full recourse, and I … constraints. During housing busts, longer selling times spill over into higher foreclosure risk, thereby magnifying the response …

in an in- complete markets macroeconomic model with long-term mortgages and equilibrium default. I show that search risk … spills over into higher foreclosure risk by creating a debt overhang problem. Heavily indebted sellers post high selling … prices, take a long time to sell, and frequently end up in foreclosure. As a result, search risk increases mortgage default …

, the reverse occurs. Based on these insights, I consider a foreclosure reform that makes all mortgages full recourse, and I … constraints. During housing busts, longer selling times spill over into higher foreclosure risk, thereby magnifying the response …