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Residential mortgage default: Theory works and so does policy

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  • Goodman, Allen C.
  • Smith, Brent C.
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    Abstract

    Using a national loan level data set we examine loan default as explained by local demographic characteristics and state level legislation that regulates foreclosure procedures and predatory lending, using a hierarchical linear model. When controlling for loan and local conditions, we observe significant variation in the default rate across states, with lower default levels in states with higher temporal and financial costs to lenders. State level legislative influences provide a foundation for discussion of national level policy that further regulates predatory lending and financial institution foreclosure activities.

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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of Housing Economics.

    Volume (Year): 19 (2010)
    Issue (Month): 4 (December)
    Pages: 280-294

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    Handle: RePEc:eee:jhouse:v:19:y:2010:i:4:p:280-294

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    Web page: http://www.elsevier.com/locate/inca/622881

    Related research

    Keywords: Residential mortgage default Predatory lending Mortgage pricing;

    References

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    Cited by:
    1. Huang, Haifang & Humphreys, Brad, 2012. "Do New Sports Facilities Revitalize Urban Neighborhoods? Evidence from Residential Mortgage Applications," Working Papers 2012-5, University of Alberta, Department of Economics.
    2. Rogers, William H. & Winkler, Anne E., 2013. "The Relationship between the Housing & Labor Market Crises and Doubling-Up: An MSA-Level Analysis, 2005-2010," IZA Discussion Papers 7263, Institute for the Study of Labor (IZA).
    3. Rui Pascoal, 2012. "Macroeconomic Factors of Household Default. Is There Myopic Behaviour?," GEMF Working Papers 2012-20, GEMF - Faculdade de Economia, Universidade de Coimbra.
    4. Huang, Haifang & Humphreys, Brad & Zhou, Li, 2014. "Urban Casinos and Local Housing Markets: Evidence from the US," Working Papers 2014-4, University of Alberta, Department of Economics.

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