We present evidence that affiliation between the debt renegotiator and the originator represents a mechanism to reduce asymmetric information inherent in debt renegotiation. We hypothesize that affiliation affords servicers lower-cost access to borrower information, thus improving their ability...

We examine the role of borrower concerns about future credit availability in mitigating the effects of adverse selection and income misrepresentation in the mortgage market. We show that the majority of additional risk associated with "low-doc'' mortgages originated prior to the Great Recession...