Just the Facts: An Initial Analysis of Subprime's Role in the Housing Crisis

Détails

ID Serval
serval:BIB_C061EDE3FEF3
Type
Article: article d'un périodique ou d'un magazine.
Collection
Publications
Titre
Just the Facts: An Initial Analysis of Subprime's Role in the Housing Crisis
Périodique
Journal of Housing Economics
Auteur(s)
Foote C., Gerardi K., Goette L., Willen P.
ISSN
1051-1377
Statut éditorial
Publié
Date de publication
2009
Peer-reviewed
Oui
Volume
17
Numéro
4
Pages
291 - 305
Langue
anglais
Résumé
Using two large proprietary datasets from New England, this paper establishes some basic facts about the subprime crisis. First, while unaffordable interest-rate resets are often blamed for setting off this crisis, most subprime borrowers who defaulted did so well in advance of their reset dates. Defaults on subprime adjustable-rate mortgages are more sensitive to declining housing prices than are defaults on fixed-rate loans, however, and the data support a number of alternative explanations for this finding. Second, many borrowers with good credit scores took out subprime loans as the housing boom gathered steam. It is hard to construct a prima facie case that these borrowers were inappropriately steered into the subprime market, however, because the loans that these borrowers took out were too risky for prime treatment. Finally, 70% of Massachusetts homes recently lost to foreclosure were originally purchased with prime mortgages. But subprime refinancing is especially prevalent among owners who were likely to have extracted substantial amounts of equity before they defaulted.
Mots-clé
Mortgage, Subprime, Crisis
Web of science
Création de la notice
10/08/2009 13:45
Dernière modification de la notice
03/03/2018 21:05
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