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Debtor Fraud in Consumer Debt Renegotiation
Mikhed, Vyacheslav; Raina, Sahil; Scholnick, Barry; … - 2022
We study how forcing financially distressed consumer debtors to repay a larger fraction of debt can lead them to misreport data fraudulently. Using a plausibly exogenous policy change that required debtors to increase repayment to creditors, we document that debtors manipulated data to avoid...
Persistent link: https://www.econbiz.de/10014236487
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The Cost of Consumer Collateral : Evidence from Bunching
Collier, Benjamin; Ellis, Cameron; Keys, Benjamin J. - 2022
How do collateral requirements impact consumer borrowing behavior? Using administrative loan application and … their residence as collateral. One-third of all borrowers select the maximum uncollateralized loan amount, and our bunching … estimates suggest that the median borrower is willing to give up 40% of their loan amount to avoid collateral. Exploiting time …
Persistent link: https://www.econbiz.de/10013297128
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Bancarizing with credit cards : experimental evidence on interest rates and minimum payments elasticities for new clients
Seira, Enrique; Castellanos, Sara G.; Hernández, Diego … - 2015
We study the bancarization of marginal borrowers using credit cards and document that this process is difficult: default risk is substantial, returns heterogeneous, and account closings common. We also take advantage of a randomized control trial that varied interest rates and minimum payments...
Persistent link: https://www.econbiz.de/10011281263
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Screening on Loan Terms : Evidence from Maturity Choice in Consumer Credit
Hertzberg, Andrew - 2017
We exploit a natural experiment in the largest online consumer lending platform to provide the first evidence that loan terms, in particular maturity choice, can be used to screen borrowers based on their private information. We compare two groups of observationally equivalent borrowers who took...
Persistent link: https://www.econbiz.de/10012971431
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Screening on Loan Terms : Evidence from Maturity Choice in Consumer Credit
Hertzberg, Andrew; Liberman, Andres; Paravisini, Daniel - 2020
We exploit a natural experiment in the largest online consumer lending platform to provide the first evidence that loan terms, in particular maturity choice, can be used to screen borrowers based on their private information. We compare two groups of observationally equivalent borrowers who took...
Persistent link: https://www.econbiz.de/10014116640
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The Pricing Strategies of Unsecured Consumer Loans
Lu, Lei - 2020
This paper analyzes lenders' pricing strategies in the business-to-customer (B2C) unsecured loan market by using a proprietary dataset of approximately 3 million unsecured consumer loans from a B2C online retailer in China. We find that lenders' decisions to invite customers are based on...
Persistent link: https://www.econbiz.de/10012838385
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Strategic Default on First and Second Lien Mortgages During the Financial Crisis
Jagtiani, Julapa - 2019
Strategic default behavior suggests that the default process is not only a matter of inability to pay. Economic costs and benefits affect the incidence and timing of defaults. As with prior research, the authors find that people default strategically as their home value falls below the mortgage...
Persistent link: https://www.econbiz.de/10012905985
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Should Defaults Be Forgotten? Evidence from Variation in Removal of Negative Consumer Credit Information
Bos, Marieke - 2014
Practically all industrialized economies restrict the length of time that credit bureaus can retain borrowers' negative credit information. There is, however, a large variation in the permitted retention times across countries. By exploiting a quasi-experimental variation in this retention time,...
Persistent link: https://www.econbiz.de/10013048956
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Does leverage predict delinquency in consumer lending? : evidence from Peru
Cuba, Walter - 2020
This paper examines to what extent household leverage - as measured by the debt-to-income (DTI) ratio - predicts delinquency in Peru's consumer credit market. A model is estimated to assess the relation between delinquency and the DTI ratio. The initial and current DTI ratios are assessed as...
Persistent link: https://www.econbiz.de/10012171272
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Credit Building or Credit Crumbling? A Credit Builder Loan’s Effects on Consumer Behavior, Credit Scores and Their Predictive Power
Burke, Jeremy - 2020
There is little evidence on how the large market for credit score improvement products affects consumers or credit market efficiency. A randomized encouragement design on a standard credit builder loan (CBL) identifies null average effects on whether consumers have a credit score and the score...
Persistent link: https://www.econbiz.de/10012848541