Priority spreading refers to the practice of firms increasing their reliance on secured and subordinated debt and reducing their reliance on senior debt as their credit quality deteriorates. We argue that priority spreading occurs, in part, because security provides creditors with greater...

Recent studies use retrospective automated valuation models (AVMs) to investigate whether appraisals of collateral values associated with securitized residential mortgage loans were systematically inflated during the recent housing boom. In this paper, we provide evidence that high AVM pricing...