Predatory lending laws and the cost of credit
AbstractVarious states and other local jurisdictions have enacted laws intending to reduce predatory and abusive lending in the subprime mortgage market. These laws have created substantial geographic variation in the regulation of mortgage credit. This article examines whether these laws are associated with a higher or lower cost of credit. Empirical results indicate that the laws are associated with at most a modest increase in cost. However, the impact depends on the product type. In particular, loans with fixed (adjustable) rates are associated with a modest increase (decrease) in cost. Copyright 2008 American Real Estate and Urban Economics Association
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Bibliographic InfoPaper provided by Federal Reserve Bank of St. Louis in its series Working Papers with number 2006-022.
Date of creation: 2006
Date of revision:
Other versions of this item:
- NEP-ALL-2006-04-29 (All new papers)
- NEP-CFN-2006-04-29 (Corporate Finance)
- NEP-FMK-2006-04-29 (Financial Markets)
- NEP-REG-2006-04-29 (Regulation)
- NEP-URE-2006-04-29 (Urban & Real Estate Economics)
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