We use survey data to study American households' propensity to default when the value of their mortgage exceeds the … value of their house even if they can afford to pay their mortgage (strategic default). We find that 26% of the existing … the house. Yet, 17% of households would default, even if they can afford to pay their mortgage, when the equity shortfall …

We use survey data to study American households' propensity to default when the value of their mortgage exceeds the … value of their house even if they can afford to pay their mortgage (strategic default). We find that 26% of the existing … the house. Yet, 17% of households would default, even if they can afford to pay their mortgage, when the equity shortfall …

homeowner only once the loan is repaid. By effectively reducing the LTV of the mortgage, it increases the homeowner's incentives …

This paper examines the impact of state bankruptcy homestead exemptions on mortgage application outcomes. The empirical … analysis controls for endogeneity problems by focusing on 55 urban areas cross state borders using the Home Mortgage Disclosure … Act files from 2001 to 2008. The results indicate that holding the loan-to-value ratio constant, a more generous homestead …