Economic theory predicts that a binding interest-rate cap decreases credit availability for high-risk borrowers. On March 23, 2021, Illinois imposed an all-in interest-rate cap of 36 percent per annum for loans under $40,000 from non-bank and non-credit-union lenders. We use credit bureau data...

In the United States, the lowest interest rate cap on small-dollar installment loans 17 percent is in Arkansas. No small-dollar installment lenders operate within Arkansas, while they do in all six states bordering Arkansas providing a natural experiment to examine the effects of a binding...

The boom in the subprime mortgage market yielded many loans with high LTV ratios. From a large proprietary database on subprime mortgages, we find that choice of mortgage rate type is not linear in loan sizes. A fixed rate mortgage contract is a popular choice when loan size, measured by LTV...

This paper examines pricing of subprime first mortgages by brokers and lenders using data on loans in originated between the first quarter of 1998 to the first quarter of 2006 at seven large subprime mortgage lenders. The results provide little evidence that most consumers obtaining mortgages...