We use variation in mortgage modifications to disentangle the impact of reducing long-term obligations with no change in short-term payments (“wealth”), and reducing short-term payments with approximately no change in long-term obligations (“liquidity”). Using regression discontinuity...

We use variation in mortgage modifications to disentangle the impact of reducing long-term obligations with no change in short-term payments ("wealth"), and reducing short-term payments with approximately no change in long-term obligations ("liquidity"). Using regression discontinuity and...

There are two prevailing theories of borrower default: strategic default—when debt is too high relative to the value of the house—and adverse life events—such that the monthly payment is too high relative to available resources. It has been challenging to test between these theories in...

There are two prevailing theories of borrower default: strategic default--when debt is too high relative to the value of the house--and adverse life events--such that the monthly payment is too high relative to available resources. It has been challenging to test between these theories in part...

American families carry more than $1.5 trillion in student loan debt. This debt provided many with the opportunity to pursue higher education, but remains for others a large, potentially crippling, financial burden. In this report, we explore how people of different socioeconomic groups are...