Using individual-level data on homeowner debt and defaults from 1997 to 2008, we show that borrowing against the increase in home equity by existing homeowners is responsible for a significant fraction of both the sharp rise in U.S. household leverage from 2002 to 2006 and the increase in...

Using individual-level data on homeowner debt and defaults from 1997 to 2008, we show that borrowing against the increase in home equity by existing homeowners is responsible for a significant fraction of both the rise in U.S. household leverage from 2002 to 2006 and the increase in defaults...

Consumer insolvency is a topic that has gained much prominence in the context of the financial crisis on both sides of the Atlantic. The number of bankruptcy filings has soared in recent years, and is not expected to go down in the near future.This CEPS Working Document explains the consumer...

Using the 2010 and 2013 Survey of Consumer Finances (N=12,497), this study investigates the relationship between credit constraint and credit use of U.S. households after the Great Recession. Credit use is identified for two major categories of household debt, (1) installment loan debt and (2)...

The recession that started in December 2007 was longer than any since the Great Depression of the 1930s. Household incomes dropped and unemployment rates increased to over 9%. We investigate the proportion of households having financial obligations over 40% of pretax income (having a high...

Financial innovation and overconfidence about asset values and the riskiness of new financial products were important factors behind the U.S. credit crisis. We show that a boom-bust cycle in debt, asset prices and consumption characterizes the equilibrium dynamics of a model with a collateral...

Using individual-level data on homeowner debt and defaults from 1997 to 2008, we show that borrowing against the increase in home equity by existing homeowners is responsible for a significant fraction of both the sharp rise in U.S. household leverage from 2002 to 2006 and the increase in...

The initial implementation of the System of National Accounts (1993) for the United States by the Bureau of Economic Analysis and the Federal Reserve Board has two significant advantages for economists. First, the SNA are organized according to sectors of the economy defined by economic agents:...