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individuals may file for bankruptcy or default on their mortgage. Uncertainty in the model is driven by house price shocks …, education specific productivity shocks, and catastrophic consumption events, while bankruptcy is governed by the basic … Bankruptcy policy. …
Persistent link: https://www.econbiz.de/10013167646
individuals may file for bankruptcy or default on their mortgage. Uncertainty in the model is driven by house price shocks …, education specific productivity shocks, and catastrophic consumption events, while bankruptcy is governed by the basic … Bankruptcy policy. …
Persistent link: https://www.econbiz.de/10013479037
Financial innovations are a common explanation of the rise in consumer credit and bankruptcies. To evaluate this story, we develop a simple model that incorporates two key frictions: asymmetric information about borrowers' risk of default and a fixed cost to create each contract offered by...
Persistent link: https://www.econbiz.de/10010291903
Financial innovations are a common explanation for the rise in credit card debt and bankruptcies. To evaluate this story, we develop a simple model that incorporates two key frictions: asymmetric information about borrowers' risk of default and a fixed cost of developing each contract lenders...
Persistent link: https://www.econbiz.de/10011441843
its passage. Before BAR, over-indebted mortgagors could free up income to pay the mortgage by filing bankruptcy and having …We argue that the 2005 bankruptcy abuse reform (BAR) contributed to the surge in subprime foreclosures that followed … effects of BAR using state home equity bankruptcy exemptions; filers in low-exemption states were not very protected before …
Persistent link: https://www.econbiz.de/10010283566
This study investigates the relationship between debtor punishment and the development of the credit market. We empirically analyze how the level of debtor punishment relates to the credit market expansion. We find evidence that an increase in debtor punishment tends to produce a positive effect...
Persistent link: https://www.econbiz.de/10011241839
We are the first to show that the cost of personal bankruptcy filers traveling to their bankruptcy trustees affects … bankruptcy choices. We use detailed balance sheet, income statement, and location data from 400,000 Canadian bankruptcies. To … bankruptcy trustees (while filers interact with trustees, and trustees interact with local government, filers do not interact …
Persistent link: https://www.econbiz.de/10010785657
Financial innovations are a common explanation for the rise in credit card debt and bankruptcies. To evaluate this story, we develop a simple model that incorporates two key frictions: asymmetric information about borrowers’ risk of default and a fixed cost of developing each contract lenders...
Persistent link: https://www.econbiz.de/10010986693
consumer bankruptcy filers. In particular, the authors’ data allow them to distinguish between Chapter 7 and Chapter 13 … bankruptcy filings, to observe changes in credit demand and credit supply explicitly, and to differentiate existing and new … credit accounts. The paper has four main findings. First, despite speedy recovery in their risk scores after bankruptcy …
Persistent link: https://www.econbiz.de/10010930292
The 2005 Bankruptcy Abuse Prevention and Consumer Protection Act limited homestead exemptions and imposed means test to …
Persistent link: https://www.econbiz.de/10010930716