Author: Matthew Chambers
Publisher:
ISBN:
Category :
Languages : en
Pages : 56
Book Description
The last decade has brought about substantial mortgage innovation and increased refinancing. The objective of the paper is to understand the determinants and implications of mortgage choice in the context of general equilibrium model with incomplete markets. The equilibrium characterization allows us to study the impact of mortgage financing = decisions in the productive economy. We show the influence of different contract characteristics such as the downpayment requirement, repayment structure, and the amortization schedule for mortgage choice. We find that loan products that allow for low or no downpayment or an increasing repayment schedule increase the participation of young and lower income households. We find evidence that the volume of housing transactions increase when the payment profile is increasing and households have little housing equity. In contrast, we show that loans that allow for a rapid accumulation of home equity can still have positive participation effects without increasing the volatility of the housing market. The model predicts that the expansion of mortgage contracts and refinancing improves risk sharing opportunities for homeowners but the magnitude varies with each contract.
Equilibrium Mortgage Choice and Housing Tenure Decisions With Refinancing
Author: Matthew Chambers
Publisher:
ISBN:
Category :
Languages : en
Pages : 56
Book Description
The last decade has brought about substantial mortgage innovation and increased refinancing. The objective of the paper is to understand the determinants and implications of mortgage choice in the context of general equilibrium model with incomplete markets. The equilibrium characterization allows us to study the impact of mortgage financing = decisions in the productive economy. We show the influence of different contract characteristics such as the downpayment requirement, repayment structure, and the amortization schedule for mortgage choice. We find that loan products that allow for low or no downpayment or an increasing repayment schedule increase the participation of young and lower income households. We find evidence that the volume of housing transactions increase when the payment profile is increasing and households have little housing equity. In contrast, we show that loans that allow for a rapid accumulation of home equity can still have positive participation effects without increasing the volatility of the housing market. The model predicts that the expansion of mortgage contracts and refinancing improves risk sharing opportunities for homeowners but the magnitude varies with each contract.
Publisher:
ISBN:
Category :
Languages : en
Pages : 56
Book Description
The last decade has brought about substantial mortgage innovation and increased refinancing. The objective of the paper is to understand the determinants and implications of mortgage choice in the context of general equilibrium model with incomplete markets. The equilibrium characterization allows us to study the impact of mortgage financing = decisions in the productive economy. We show the influence of different contract characteristics such as the downpayment requirement, repayment structure, and the amortization schedule for mortgage choice. We find that loan products that allow for low or no downpayment or an increasing repayment schedule increase the participation of young and lower income households. We find evidence that the volume of housing transactions increase when the payment profile is increasing and households have little housing equity. In contrast, we show that loans that allow for a rapid accumulation of home equity can still have positive participation effects without increasing the volatility of the housing market. The model predicts that the expansion of mortgage contracts and refinancing improves risk sharing opportunities for homeowners but the magnitude varies with each contract.
Equilibrium Mortgage Choice and Housing Tenure Decisions with Refinancing
Author: Matthew Chambers
Publisher:
ISBN:
Category : Mortgage loans
Languages : en
Pages :
Book Description
"The last decade has brought about substantial mortgage innovation and increased refinancing. The objective of the paper is to understand the determinants and implications of mortgage choice in the context of general equilibrium model with incomplete markets. The equilibrium characterization allows us to study the impact of mortgage financing = decisions in the productive economy. We show the influence of different contract characteristics such as the downpayment requirement, repayment structure, and the amortization schedule for mortgage choice. We find that loan products that allow for low or no downpayment or an increasing repayment schedule increase the participation of young and lower income households. We find evidence that the volume of housing transactions increase when the payment profile is increasing and households have little housing equity. In contrast, we show that loans that allow for a rapid accumulation of home equity can still have positive participation effects without increasing the volatility of the housing market. The model predicts that the expansion of mortgage contracts and refinancing improves risk sharing opportunities for homeowners but the magnitude varies with each contract"--Federal Reserve Bank of St. Louis web site.
Publisher:
ISBN:
Category : Mortgage loans
Languages : en
Pages :
Book Description
"The last decade has brought about substantial mortgage innovation and increased refinancing. The objective of the paper is to understand the determinants and implications of mortgage choice in the context of general equilibrium model with incomplete markets. The equilibrium characterization allows us to study the impact of mortgage financing = decisions in the productive economy. We show the influence of different contract characteristics such as the downpayment requirement, repayment structure, and the amortization schedule for mortgage choice. We find that loan products that allow for low or no downpayment or an increasing repayment schedule increase the participation of young and lower income households. We find evidence that the volume of housing transactions increase when the payment profile is increasing and households have little housing equity. In contrast, we show that loans that allow for a rapid accumulation of home equity can still have positive participation effects without increasing the volatility of the housing market. The model predicts that the expansion of mortgage contracts and refinancing improves risk sharing opportunities for homeowners but the magnitude varies with each contract"--Federal Reserve Bank of St. Louis web site.
Housing Financing Behavior
Author: Hsiu-Wen Wu
Publisher:
ISBN:
Category : Adjustable rate mortgages
Languages : en
Pages : 764
Book Description
Publisher:
ISBN:
Category : Adjustable rate mortgages
Languages : en
Pages : 764
Book Description
Overlapping Generations
Author: Stephen E. Spear
Publisher: Emerald Group Publishing
ISBN: 1837530521
Category : Business & Economics
Languages : en
Pages : 261
Book Description
The 800 pound gorilla in the room of macroeconomics is the question of why the overlapping generations model didn’t become the central workhorse model for macroeconomics, as opposed to the neoclassical growth model. The authors here explore the co-evolution of the two models.
Publisher: Emerald Group Publishing
ISBN: 1837530521
Category : Business & Economics
Languages : en
Pages : 261
Book Description
The 800 pound gorilla in the room of macroeconomics is the question of why the overlapping generations model didn’t become the central workhorse model for macroeconomics, as opposed to the neoclassical growth model. The authors here explore the co-evolution of the two models.
Endogenous Mortgage Choice, Borrowing Constraints and the Tenure Decision
Author: William C. LaFayette
Publisher:
ISBN:
Category : Home ownership
Languages : en
Pages : 29
Book Description
Earlier research has shown that lender income and wealth constraint ratios discourage homeownership. This empirical research has been based on home purchasers using an 80 percent loan-to-value (LTV) fixed-rate conventional loan. Employing the same assumption, we find that the constraints lowered the ownership rate of our 1919 young home purchasers by about 20 percentage points. However, households are not restricted to putting 20 percent down and choosing a fixed- rate loan. When we allow households to select the optimal LTV and mortgage type (adjustable or fixed-rate with Federal Housing Administration (FHA) or conventional insurance), the percentage of our sample that is credit constrained declines from 71 to 49. Moreover, the measured impact on the homeownership rate of the constraints falls to only 4 percentage points. Further, FHA loans are estimated to increase homeownership by only 0.1 to 0.2 percentage points
Publisher:
ISBN:
Category : Home ownership
Languages : en
Pages : 29
Book Description
Earlier research has shown that lender income and wealth constraint ratios discourage homeownership. This empirical research has been based on home purchasers using an 80 percent loan-to-value (LTV) fixed-rate conventional loan. Employing the same assumption, we find that the constraints lowered the ownership rate of our 1919 young home purchasers by about 20 percentage points. However, households are not restricted to putting 20 percent down and choosing a fixed- rate loan. When we allow households to select the optimal LTV and mortgage type (adjustable or fixed-rate with Federal Housing Administration (FHA) or conventional insurance), the percentage of our sample that is credit constrained declines from 71 to 49. Moreover, the measured impact on the homeownership rate of the constraints falls to only 4 percentage points. Further, FHA loans are estimated to increase homeownership by only 0.1 to 0.2 percentage points
Endogenous Mortgage Choice, Borrowing Constraints and the Tenure Decision
Author: William C. LaFayette
Publisher:
ISBN:
Category :
Languages : en
Pages : 36
Book Description
Earlier research has shown that lender income and wealth constraint ratios discourage homeownership. This empirical research has been based on home purchasers using an 80 percent loan-to-value (LTV) fixed-rate conventional loan. Employing the same assumption, we find that the constraints lowered the ownership rate of our 1919 young home purchasers by about 20 percentage points. However, households are not restricted to putting 20 percent down and choosing a fixed- rate loan. When we allow households to select the optimal LTV and mortgage type (adjustable or fixed-rate with Federal Housing Administration (FHA) or conventional insurance), the percentage of our sample that is credit constrained declines from 71 to 49. Moreover, the measured impact on the homeownership rate of the constraints falls to only 4 percentage points. Further, FHA loans are estimated to increase homeownership by only 0.1 to 0.2 percentage points.
Publisher:
ISBN:
Category :
Languages : en
Pages : 36
Book Description
Earlier research has shown that lender income and wealth constraint ratios discourage homeownership. This empirical research has been based on home purchasers using an 80 percent loan-to-value (LTV) fixed-rate conventional loan. Employing the same assumption, we find that the constraints lowered the ownership rate of our 1919 young home purchasers by about 20 percentage points. However, households are not restricted to putting 20 percent down and choosing a fixed- rate loan. When we allow households to select the optimal LTV and mortgage type (adjustable or fixed-rate with Federal Housing Administration (FHA) or conventional insurance), the percentage of our sample that is credit constrained declines from 71 to 49. Moreover, the measured impact on the homeownership rate of the constraints falls to only 4 percentage points. Further, FHA loans are estimated to increase homeownership by only 0.1 to 0.2 percentage points.
Mortgage Choice, Tenure Choice, and Housing Demand in the Presence of Mortgage Qualifications Constraints
Author: William Carl LaFayette
Publisher:
ISBN:
Category :
Languages : en
Pages : 418
Book Description
Publisher:
ISBN:
Category :
Languages : en
Pages : 418
Book Description
Mortgage Choice
Author: Richard Stanton
Publisher:
ISBN:
Category : Equilibrium
Languages : en
Pages : 48
Book Description
Publisher:
ISBN:
Category : Equilibrium
Languages : en
Pages : 48
Book Description
Wealth Effects on Households' Tenure Choice, Housing Demand and Housing Finance Decisions
Author: Lawrence D. Jones
Publisher:
ISBN:
Category : House buying
Languages : en
Pages : 221
Book Description
This study investigates the importance of nonhuman wealth endowments and portfolio balance objectives as determinants of a series of family housing decisions. These decisions include i) tenure choice, and for those families choosing the ownership mode, ii) the amount of housing demand and iii) the debt/equity financing structure utilized to acquire and maintain the housing asset. The presence of the study is that tenure choice, housing demand and housing finance issues cannot be understood in a format which fails to include wealth and portfolio considerations as major factors. The analysis is premised upon the a priori conceptual belief that these variables ought to dominate traditional income flow and demographic attribute variables in explaining these household decisions.
Publisher:
ISBN:
Category : House buying
Languages : en
Pages : 221
Book Description
This study investigates the importance of nonhuman wealth endowments and portfolio balance objectives as determinants of a series of family housing decisions. These decisions include i) tenure choice, and for those families choosing the ownership mode, ii) the amount of housing demand and iii) the debt/equity financing structure utilized to acquire and maintain the housing asset. The presence of the study is that tenure choice, housing demand and housing finance issues cannot be understood in a format which fails to include wealth and portfolio considerations as major factors. The analysis is premised upon the a priori conceptual belief that these variables ought to dominate traditional income flow and demographic attribute variables in explaining these household decisions.
Mortgage Choice, Tenure Choice, and Housing Demand in the Presence of Mortgage Qualification Constraints
Author: William Carl LaFayette
Publisher:
ISBN:
Category : Mortgage loans
Languages : en
Pages : 209
Book Description
Publisher:
ISBN:
Category : Mortgage loans
Languages : en
Pages : 209
Book Description