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Collateral Damage: Refinancing Constraints and Regional Recessions

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Author Info
Caplin, Andrew
Freeman, Charles
Tracy, Joseph

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Abstract

In the current structure of the U.S. residential mortgage market, a decrease in property values may make it very difficult for homeowners to refinance their mortgages to take advantage of declining interest rates. In this paper, the authors show that this form of collateral constraint has greatly reduced refinancing in states with depressed property markets. They outline the interaction between regional recessions and refinancing constraints. Copyright 1997 by Ohio State University Press.

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Publisher Info
Article provided by Blackwell Publishing in its journal Journal of Money, Credit and Banking.

Volume (Year): 29 (1997)
Issue (Month): 4 (November)
Pages: 496-516
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:mcb:jmoncb:v:29:y:1997:i:4:p:496-516

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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0022-2879

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  1. Joao Cocco & John Campbell, 2004. "Household Risk Management and Optimal Mortgage Choice," Econometric Society 2004 North American Winter Meetings 646, Econometric Society. [Downloadable!]
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  2. Sergio Clavijo & Michel Janna & Santiago Munoz, 2005. "The Housing Market in Colombia: Socioeconomic and Financial Determinants," RES Working Papers 4389, Inter-American Development Bank, Research Department. [Downloadable!]
  3. Sergio Clavijo & Michel Janna & Santiago Muñoz, . "La Vivienda en Colombia: Sus Determinantes Socio-Económicos y Financieros," Borradores de Economia 300, Banco de la Republica de Colombia. [Downloadable!]
  4. Jill Wetmore & Chiaku Ndu, 2006. "Mortgage Refinancing Activity: An Explanation [1990–2001]," The Journal of Real Estate Finance and Economics, Springer, vol. 33(1), pages 75-86, August. [Downloadable!] (restricted)
  5. Sumit Agarwal & John C. Driscoll & David Laibson, 2007. "Optimal Mortgage Refinancing: A Closed Form Solution," NBER Working Papers 13487, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  6. Paul Flatau & Matt Forbes & Patric H. Hendershott, 2003. "Homeownership and Unemployment: The Roles of Leverage and Public Housing," NBER Working Papers 10021, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  7. Sergio Clavijo & Michel Janna & Santiago Muñoz, 2005. "La vivienda en Colombia: sus determinantes socioeconómicos y financieros," REVISTA DESARROLLO Y SOCIEDAD, UNIVERSIDAD DE LOS ANDES-CEDE. [Downloadable!]
  8. Andrew Haughwout & Richard Peach & Joseph Tracy, 2008. "Juvenile delinquent mortgages: bad credit or bad economy?," Staff Reports 341, Federal Reserve Bank of New York. [Downloadable!]
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  9. Sergio Clavijo & Michel Janna & Santiago Muñoz, 2004. "LA VIVIENDA EN COLOMBIA: Sus Determinantes Socio-Económicos y Financieros," BORRADORES DE ECONOMIA 003099, BANCO DE LA REPÚBLICA. [Downloadable!]
  10. Souphala Chomsisengphet & Anthony Pennington-Cross, 2006. "Subprime refinancing: equity extraction and mortgage termination," Working Papers 2006-023, Federal Reserve Bank of St. Louis. [Downloadable!]
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  11. Geetesh Bhardwaj & Rajdeep Sengupta, 2008. "Did prepayments sustain the subprime market?," Working Papers 2008-039, Federal Reserve Bank of St. Louis. [Downloadable!]
  12. Sergio Clavijo & Michel Janna & Santiago Munoz, 2005. "El mercado colombiano de la vivienda: factores socioeconómicos y financieros determinantes," RES Working Papers 4390, Inter-American Development Bank, Research Department. [Downloadable!]
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