The state of Nevada passed legislation in 2009 that abolished deficiency judgments for
purchase mortgage loans made after October 1, 2009, and collateralized by primary single-
family homes. In this paper, we study how this change in the law affected equilibrium
mortgage lending. Using unique mortgage loan-level application data and a difference-in-
differences approach that exploits the qualification criterion, we find that the law change led
to a decline in equilibrium loan sizes of about 1 to 2 percent. There exists some evidence …