In this paper we examine the relationship between homeowners' bankruptcy decisions and their mortgage default decisions … mortgages. Bankruptcy and foreclosure similarly may be either substitutes or complements. In fact we show that both … show that bankruptcies, defaults and foreclosures all tend to spread, i.e., higher bankruptcy rates in the neighborhood …

In this paper we examine the relationship between homeowners' bankruptcy decisions and their mortgage default decisions … mortgages. Bankruptcy and foreclosure similarly may be either substitutes or complements. In fact we show that both …The paper argues that these relationships have important public policy implications. In particular, foreclosures have …

to increase the consumption of housing space, but leverage makes it costly for homeowners to sell their homes and buy … housing space. Since renters demand less housing space than homeowners, foreclosures are a negative force affecting house … prices. The authors explore the possible effects of the government's foreclosure prevention policy in their model. They find …