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作者

来源

JOURNAL OF URBAN ECONOMICS,Vol.101,P.1-13

语言

英文

关键字

Deficiency judgment; Default; Foreclosure; Approval; Interest rate; Nevada; LAWS; BANKRUPTCY; DEFAULT; MARKET; LOANS

作者单位

[Li, Wenli] Fed Reserve Bank Philadelphia, Res Dept, Philadelphia, PA 19106 USA. [Oswald, Florian] Sci Po, Dept Econ, Paris, France. Li, WL (reprint author), Fed Reserve Bank Philadelphia, Res Dept, Philadelphia, PA 19106 USA. E-Mail: wenli.li@phil.frb.org; florian.oswald@sciencespo.fr

摘要

The state of Nevada passed legislation in 2009 that abolished deficiency judgments for purchase mortgage loans made after October 1, 2009, and collateralized by primary single-family homes. In this paper, we study how this change in the law affected equilibrium mortgage lending. Using unique mortgage loan-level application data and a difference-in-differences approach that exploits the qualification criterion, we find that the law change led to a decline in equilibrium loan sizes of about 1 to 2 percent. There exists some evidence that mortgage approval rates also decreased for the affected loan applications. These results suggest that making the deficiency judgment law more default friendly in Nevada generated material cost on borrowers at the time of mortgage origination. (C) 2017 Elsevier Inc. All rights reserved.