We define predatory lending as a welfare-reducing provision of credit. Using a textbook model, we show that lenders profit if they can tempt households into “debt traps,” that is, overborrowing and delinquency. We then test whether payday lending fits our definition of predatory. We find...

Over-indebtedness of private households has been a problem in Germany for decades. Over-indebtedness depends on both the economic and financial vulnerability of people and their resilience potential. Social, economic and individual causes and triggers overlap in the process of over-indebtedness....

Die vorliegende Studie zielt auf die Einschätzung der ökonomischen Stabilität der Haushalte in Deutschland ab. Ausgehend von der Betrachtung der unterschiedlichen Immobilienfinanzierungsregime wird anhand aggregierter und disaggregierter Haushaltsdaten die wirtschaftliche und finanzielle...

Since 1 June 2003 the file of the Central Office for Credits to Private Individuals has recorded information relating to all consumer credits and mortgage loans contracted by natural persons for private purposes, as well as any payment defaults resulting from these loans. This registration aims...

Since 1 June 2003 the file of the Central Office for Credits to Private Individuals has recorded information relating to all consumer credits and mortgage loans contracted by natural persons for private purposes, as well as any payment defaults resulting from these loans. This registration aims...

Assuming a risk-neutral bank and assuming household utility to be exponential, we show how under information symmetry the covariance of income and loan repayments may explain higher household borrowings than in the case without default option. Under ex post information asymmetry and positive...

We report the results of a longitudinal intervention with students across five universities in China designed to reduce online consumer debt. Our research design allocates individuals to either a financial literacy treatment, a self-control training program, or a zero-touch control group....

This paper finds that stricter laws regulating third-party debt collection reduce the number of third-party debt collectors, lower the recovery rates on delinquent credit card loans, and lead to a modest decrease in the openings of new revolving lines of credit. Further, stricter third-party...

Institutions often offer a menu of contracts to consumers in an attempt to create a separating equilibrium that reveals borrower types and provides better pricing. We test the effectiveness of a specific set of contracts in the mortgage market: mortgage points. Points allow borrowers to exchange...

There is a need to identify household debt behaviour in different age cohorts even in countries without prominent household debt problems so that the measures for vulnerable groups can be made. Authors used multilevel mixed effect analysis to test the effect of age and other variables on demand...