We document the fact that servicers have been reluctant to renegotiate mortgages since the foreclosure crisis started in 2007, having performed payment reducing modifications on only about 3 percent of seriously delinquent loans. We show that this reluctance does not result from securization:...

A leading explanation for the lack of widespread mortgage renegotiation during the financial crisis is the existence of frictions in the mortgage securitization process. This paper finds little evidence that the securitization process impeded the ability of lenders to renegotiate home mortgages,...

This paper analyzes the importance of households' perceptions of house price risk in explaininghomeownership choice. While a majority of US households (71%) believes that housing is a “safe”investment, renters are much more likely to perceive housing as a risky investment (conditionalon...

This paper analyzes the importance of household perceptions of house price risk in explaining homeownership choice. While a majority of US households (71%) believes that housing is a “safe” investment, renters are much more likely to perceive housing as risky. Risk perceptions vary across...

We document the fact that servicers have been reluctant to renegotiate mortgages since the foreclosure crisis started in 2007, having performed payment-reducing modifications on only about 3 percent of seriously delinquent loans. We show that this reluctance does not result from securitization:...