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The post-foreclosure experience of U.S. households

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  • Raven S. Molloy
  • Hui Shan

Abstract

Despite the recent flood of foreclosures on residential mortgages, little is known about what happens to borrowers and their households after their mortgage has been foreclosed. We study the post-foreclosure experience of U.S. households using a unique dataset based on the credit reports of a large panel of individuals to from 1999 to 2010. Although foreclosure considerably raises the probability of moving, the majority of post-foreclosure migrants do not end up in substantially less desirable neighborhoods or more crowded living conditions. These results suggest that, on average, foreclosure does not impose an economic burden large enough to severely reduce housing consumption.

Suggested Citation

  • Raven S. Molloy & Hui Shan, 2011. "The post-foreclosure experience of U.S. households," Finance and Economics Discussion Series 2011-32, Board of Governors of the Federal Reserve System (U.S.).
  • Handle: RePEc:fip:fedgfe:2011-32
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    References listed on IDEAS

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    Cited by:

    1. Jennifer Brown & David A. Matsa, 2016. "Locked in by Leverage: Job Search during the Housing Crisis," NBER Working Papers 22929, National Bureau of Economic Research, Inc.
    2. Elliot Anenberg & Patrick Bayer, 2013. "Endogenous sources of volatility in housing markets: the joint buyer-seller problem," Finance and Economics Discussion Series 2013-60, Board of Governors of the Federal Reserve System (U.S.).
    3. Jung Choi & Gary Painter, 2015. "Housing Formation and Unemployment Rates: Evidence from 1975–2011," The Journal of Real Estate Finance and Economics, Springer, vol. 50(4), pages 549-566, May.
    4. Wardrip, Keith & Hunt, Robert M., 2013. "Residential Migration, Entry, and Exit as Seen Through the Lens of Credit Bureau Data," Payment Cards Center Discussion Paper 13-4, Federal Reserve Bank of Philadelphia.
    5. Adam M. Guren & Timothy J. McQuade, "undated". "How Do Foreclosures Exacerbate Housing Downturns?," Boston University - Department of Economics - Working Papers Series WP2018-007, Boston University - Department of Economics.
    6. repec:eee:regeco:v:68:y:2018:i:c:p:277-290 is not listed on IDEAS
    7. William H. Rogers & Anne E. Winkler, 2014. "How Did the Housing and Labor Market Crises Affect Young Adults' Living Arrangements?," Working Papers 1005, University of Missouri-St. Louis, Department of Economics.
    8. Chan, Sewin & Haughwout, Andrew & Tracy, Joseph, 2015. "How Mortgage Finance Affects the Urban Landscape," Handbook of Regional and Urban Economics, Elsevier.
    9. Rogers, William H. & Winkler, Anne E., 2014. "How Did the Housing and Labor Market Crises Affect Young Adults' Living Arrangements?," IZA Discussion Papers 8568, Institute for the Study of Labor (IZA).
    10. Ding, Lei & Hwang, Jackelyn & Divringi, Eileen, 2016. "Gentrification and residential mobility in Philadelphia," Regional Science and Urban Economics, Elsevier, vol. 61(C), pages 38-51.
    11. Askitas, Nikos & Zimmermann, Klaus F., 2011. "Detecting Mortgage Delinquencies," IZA Discussion Papers 5895, Institute for the Study of Labor (IZA).
    12. Larrimore, Jeff & Schuetz, Jenny & Dodini, Samuel, 2016. "What are the Perceived Barriers to Homeownership for Young Adults?," Finance and Economics Discussion Series 2016-021, Board of Governors of the Federal Reserve System (U.S.).
    13. Lei Ding, 2017. "Borrower credit access and credit performance after loan modifications," Empirical Economics, Springer, vol. 52(3), pages 977-1005, May.

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    Foreclosure;

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