The exact cause of the massive defaults and foreclosures in the U.S. subprime mortgage market is still unclear. This paper investigates whether a particular aspect of borrowers' financial literacy - their numerical ability - may have played a role. We measure several aspects of financial...

This paper analyzes the role of uncertainty in a multi-sector housing model with financial frictions. We include time varying uncertainty (i.e. risk shocks) in the technology shocks that affect housing production. The analysis demonstrates that risk shocks to the housing production sector are a...

This paper examines the available data on market conditions for equity release schemes (ERS) in all EU member states to cluster Member States for subsequent extrapolation of the findings from six EU Member States (DE, IT, NL, IE, HU, and the UK) to the EU as a whole. It aggregates various...

This paper examines the impact of housing tenure choice on unemployment duration in Belgium using EU‐SILC micro data. We contribute to the literature in distinguishing homeowners with mortgage payments and outright homeowners. We simultaneously estimate unemployment duration by a mixed...

The dramatic government takeover of Fannie Mae and Freddie Mac in September, 2008 was motivated in part by a desire to ensure a continued flow of credit to the mortgage market. This study examines a closely related issue: the extent to which GSE activity crowds out mortgage purchases by private...

Starting in 2008, the number of homeowners losing their homes to foreclosure began increasing dramatically. Given that troubled borrowers may not fully understand their options for modifying their mortgage, lenders and policymakers have reacted to rising foreclosure filings by increasing the use...

Since the loan limit of a reverse mortgage is a major concern for the borrower as well as the lender, this paper attempts to develop an option-based model to evaluate the loan limits of reverse mortgages. Our model can identify several crucial determinants for reverse mortgage loan limits, such...

House price volatility; lender and borrower perception of price trends, loan and property features; and the borrower's put option are integrated in a model of residential mortgage default. These dimensions of the default problem have, to our knowledge, not previously been considered altogether...

Utilizing a unique sample of community reinvestment loans, we study the propensity of very low income households to default or prepay on a mortgage and compare it to the outcomes for low income and moderate income households. The results indicate that, even within moderate and low income...

The current study investigates the recent mortgage crisis to determine whether deteriorating aggregate loan-to-value (LTV) ratios resulted in more acute default responses to depreciating home prices. We find evidence that default rates did not behave erratically or disproportionately to falling...