The rise in subprime lending and the ensuing wave of foreclosures was partly a result of
market forces that have been well-identified in the literature, but it was also a highly …

Borrowing against the increase in home equity by existing homeowners was responsible for
a significant fraction of the rise in US household leverage from 2002 to 2006 and the …

We conduct a within-county analysis using detailed ZIP code—level data to document new
findings regarding the origins of the biggest financial crisis since the Great Depression. The …

A central question surrounding the current subprime crisis is whether the securitization
process reduced the incentives of financial intermediaries to carefully screen borrowers. We …

An originate-to-distribute (OTD) model of lending, where the originator of a loan sells it to
various third parties, was a popular method of mortgage lending before the onset of the …

This paper models the causes of the 2008 financial crisis together with its manifestations,
using a Multiple Indicator Multiple Cause (MIMIC) model. Our analysis is conducted on a …

Statistical default models, widely used to assess default risk, fail to account for a change in
the relations between different variables resulting from an underlying change in agent …

Should market participants have anticipated the large increase in home foreclosures in 2007
and 2008? Most of these foreclosures stemmed from mortgage loans originated in 2005 and …

The combination of rising home prices, declining interest rates, and near-frictionless
refinancing opportunities can create unintentional synchronization of homeowner leverage …

This paper shows that a macro model with segmented financial markets can generate
sizable movements in housing prices in response to changes in credit conditions. We …