Author: Wenli Li
Publisher:
ISBN:
Category : Bankruptcy
Languages : en
Pages : 38
Book Description
In this paper we examine the relationship between homeowners' bankruptcy decisions and their mortgage default decisions and the relationship between homeowners' bankruptcy decisions and lenders' decisions to foreclose. In theory, both relationships could be either substitutes or complements. Bankruptcy and default tend to be substitutes because homeowners' budgets are limited and, if they spend less on payments to unsecured lenders, then they have more money to pay their mortgages. But bankruptcy and default may also be complements if homeowners use bankruptcy to reduce the cost of defaulting on their mortgages. Bankruptcy and foreclosure similarly may be either substitutes or complements. In fact we show that both relationships are complementary, although homeowners reacted to the 2005 bankruptcy reform by treating them as substitutes. We also show that bankruptcies, defaults and foreclosures all tend to spread, i.e., higher bankruptcy rates in the neighborhood raise homeowners' probability of filing, higher default rates raise homeowners' probability of defaulting, and higher foreclosure rates raise homeowners' probability of foreclosure. We provide estimates of the size of these effects. The paper argues that these relationships have important public policy implications. In particular, foreclosures have very high social costs, and some of these costs are external to both borrowers and lenders. As a result, there is a social gain from discouraging bankruptcies, since fewer bankruptcies mean fewer defaults and foreclosures. We show that these considerations shift optimal bankruptcy law in a pro-creditor direction, because pro-creditor bankruptcy policies reduce the number of filings and therefore reduce foreclosures. But the same considerations shift other policies that affect bankruptcy in a pro-debtor direction. This is because pro-debtor shifts in, for example, wage garnishment policy reduce the number of bankruptcy filings and therefore reduce foreclosures.
Mortgage default, foreclosure, and bankruptcy
Author: Wenli Li
Publisher:
ISBN:
Category : Bankruptcy
Languages : en
Pages : 38
Book Description
In this paper we examine the relationship between homeowners' bankruptcy decisions and their mortgage default decisions and the relationship between homeowners' bankruptcy decisions and lenders' decisions to foreclose. In theory, both relationships could be either substitutes or complements. Bankruptcy and default tend to be substitutes because homeowners' budgets are limited and, if they spend less on payments to unsecured lenders, then they have more money to pay their mortgages. But bankruptcy and default may also be complements if homeowners use bankruptcy to reduce the cost of defaulting on their mortgages. Bankruptcy and foreclosure similarly may be either substitutes or complements. In fact we show that both relationships are complementary, although homeowners reacted to the 2005 bankruptcy reform by treating them as substitutes. We also show that bankruptcies, defaults and foreclosures all tend to spread, i.e., higher bankruptcy rates in the neighborhood raise homeowners' probability of filing, higher default rates raise homeowners' probability of defaulting, and higher foreclosure rates raise homeowners' probability of foreclosure. We provide estimates of the size of these effects. The paper argues that these relationships have important public policy implications. In particular, foreclosures have very high social costs, and some of these costs are external to both borrowers and lenders. As a result, there is a social gain from discouraging bankruptcies, since fewer bankruptcies mean fewer defaults and foreclosures. We show that these considerations shift optimal bankruptcy law in a pro-creditor direction, because pro-creditor bankruptcy policies reduce the number of filings and therefore reduce foreclosures. But the same considerations shift other policies that affect bankruptcy in a pro-debtor direction. This is because pro-debtor shifts in, for example, wage garnishment policy reduce the number of bankruptcy filings and therefore reduce foreclosures.
Publisher:
ISBN:
Category : Bankruptcy
Languages : en
Pages : 38
Book Description
In this paper we examine the relationship between homeowners' bankruptcy decisions and their mortgage default decisions and the relationship between homeowners' bankruptcy decisions and lenders' decisions to foreclose. In theory, both relationships could be either substitutes or complements. Bankruptcy and default tend to be substitutes because homeowners' budgets are limited and, if they spend less on payments to unsecured lenders, then they have more money to pay their mortgages. But bankruptcy and default may also be complements if homeowners use bankruptcy to reduce the cost of defaulting on their mortgages. Bankruptcy and foreclosure similarly may be either substitutes or complements. In fact we show that both relationships are complementary, although homeowners reacted to the 2005 bankruptcy reform by treating them as substitutes. We also show that bankruptcies, defaults and foreclosures all tend to spread, i.e., higher bankruptcy rates in the neighborhood raise homeowners' probability of filing, higher default rates raise homeowners' probability of defaulting, and higher foreclosure rates raise homeowners' probability of foreclosure. We provide estimates of the size of these effects. The paper argues that these relationships have important public policy implications. In particular, foreclosures have very high social costs, and some of these costs are external to both borrowers and lenders. As a result, there is a social gain from discouraging bankruptcies, since fewer bankruptcies mean fewer defaults and foreclosures. We show that these considerations shift optimal bankruptcy law in a pro-creditor direction, because pro-creditor bankruptcy policies reduce the number of filings and therefore reduce foreclosures. But the same considerations shift other policies that affect bankruptcy in a pro-debtor direction. This is because pro-debtor shifts in, for example, wage garnishment policy reduce the number of bankruptcy filings and therefore reduce foreclosures.
Conduct of Mortgage Foreclosures During Bankruptcy ...
Author: American Bankruptcy Review, inc., New York
Publisher:
ISBN:
Category : Bankruptcy
Languages : en
Pages : 56
Book Description
Publisher:
ISBN:
Category : Bankruptcy
Languages : en
Pages : 56
Book Description
The Worsening Foreclosure Crisis
Author: United States. Congress. Senate. Committee on the Judiciary. Subcommittee on Administrative Oversight and the Courts
Publisher:
ISBN:
Category : Business & Economics
Languages : en
Pages : 152
Book Description
Publisher:
ISBN:
Category : Business & Economics
Languages : en
Pages : 152
Book Description
Surviving Debt
Author:
Publisher:
ISBN: 9781602482104
Category : Consumer credit
Languages : en
Pages : 0
Book Description
Publisher:
ISBN: 9781602482104
Category : Consumer credit
Languages : en
Pages : 0
Book Description
Effects of Bankruptcy Exemptions and Foreclosure Laws on Mortgage Default and Foreclosure Rates
Author: Chintal A. Desai
Publisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
This study analyzes the effects of state bankruptcy asset exemptions and foreclosure laws on mortgage default and foreclosure rates across different segments of the mortgage market. We found that the effects of these legal provisions are larger for sub-prime than for prime mortgages and larger for adjustable rate mortgages than for fixed rate mortgages. These results demonstrate that the effects of variation in bankruptcy exemptions and foreclosure laws is most pronounced in the most risky segments of the mortgage market, which are those that have been most affected by the continuing housing slump in the United States.
Publisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
This study analyzes the effects of state bankruptcy asset exemptions and foreclosure laws on mortgage default and foreclosure rates across different segments of the mortgage market. We found that the effects of these legal provisions are larger for sub-prime than for prime mortgages and larger for adjustable rate mortgages than for fixed rate mortgages. These results demonstrate that the effects of variation in bankruptcy exemptions and foreclosure laws is most pronounced in the most risky segments of the mortgage market, which are those that have been most affected by the continuing housing slump in the United States.
Policing Lenders and Protecting Homeowners
Author: United States. Congress. Senate. Committee on the Judiciary. Subcommittee on Administrative Oversight and the Courts
Publisher:
ISBN:
Category : Bankruptcy
Languages : en
Pages : 184
Book Description
Publisher:
ISBN:
Category : Bankruptcy
Languages : en
Pages : 184
Book Description
How to Save Your Home from Foreclosure
Author: Rosario Marano
Publisher:
ISBN: 9780967307800
Category : Business & Economics
Languages : en
Pages : 44
Book Description
An informative "how to book" for homeowners, college students, schools, real estate professionals, and the general public at large which points out various techniques and strategies on how to prevent the loss of their home to a creditor. It is a step-by-step guide offering different scenarios on how a homeowner can bring their defaulted mortgage loan current and avoid a sheriff or trustee sale. Also available for sale at www.amazon.com and www.bn.com.
Publisher:
ISBN: 9780967307800
Category : Business & Economics
Languages : en
Pages : 44
Book Description
An informative "how to book" for homeowners, college students, schools, real estate professionals, and the general public at large which points out various techniques and strategies on how to prevent the loss of their home to a creditor. It is a step-by-step guide offering different scenarios on how a homeowner can bring their defaulted mortgage loan current and avoid a sheriff or trustee sale. Also available for sale at www.amazon.com and www.bn.com.
Mortgage Defaults
Author:
Publisher: AuthorHouse
ISBN: 1468533908
Category :
Languages : en
Pages : 116
Book Description
Publisher: AuthorHouse
ISBN: 1468533908
Category :
Languages : en
Pages : 116
Book Description
Saving Homes? Bankruptcies and Loan Modifications in the Foreclosure Crisis
Author: Alan M. White
Publisher:
ISBN:
Category :
Languages : en
Pages : 40
Book Description
Do homeowner bankruptcy filings work to delay or prevent home foreclosures, and how do they compare to voluntary loan modifications specifically targeted to mortgage relief? The 2007-2012 financial crisis provides a unique opportunity to assess whether bankruptcy can help homeowners avoid the negative consequences of over-indebtedness and mortgage default. This empirical study analyzes a large, loan-level mortgage dataset to determine which variables are associated with delinquency and bankruptcy filing, and in turn, whether filing bankruptcy or receiving a loan modification measurably influences subsequent loan outcomes (e.g., foreclosure sale, prepayment, or default cure). Overall, we find that bankruptcy filings delay foreclosures but are not generally effective in curing payment defaults, especially when compared to modifications negotiated outside of bankruptcy, which are highly effective. We also find, consistent with prior research, that variations in state bankruptcy and foreclosure law greatly influence debtor outcomes from one state to another. Bankruptcy filing is more effective in states with nonjudicial foreclosure and limited homeowner protections.
Publisher:
ISBN:
Category :
Languages : en
Pages : 40
Book Description
Do homeowner bankruptcy filings work to delay or prevent home foreclosures, and how do they compare to voluntary loan modifications specifically targeted to mortgage relief? The 2007-2012 financial crisis provides a unique opportunity to assess whether bankruptcy can help homeowners avoid the negative consequences of over-indebtedness and mortgage default. This empirical study analyzes a large, loan-level mortgage dataset to determine which variables are associated with delinquency and bankruptcy filing, and in turn, whether filing bankruptcy or receiving a loan modification measurably influences subsequent loan outcomes (e.g., foreclosure sale, prepayment, or default cure). Overall, we find that bankruptcy filings delay foreclosures but are not generally effective in curing payment defaults, especially when compared to modifications negotiated outside of bankruptcy, which are highly effective. We also find, consistent with prior research, that variations in state bankruptcy and foreclosure law greatly influence debtor outcomes from one state to another. Bankruptcy filing is more effective in states with nonjudicial foreclosure and limited homeowner protections.
Texas Foreclosure Manual, Third Edition
Author: William H. Locke
Publisher:
ISBN: 9781938873065
Category : Foreclosure
Languages : en
Pages : 1198
Book Description
Publisher:
ISBN: 9781938873065
Category : Foreclosure
Languages : en
Pages : 1198
Book Description