Mortgage Defaults /

This paper incorporates house price risk and mortgages into a standard incomplete market (SIM) model. The model is calibrated to match U.S. data and accounts for non-targeted features of the data such as the distribution of down payments, the life-cycle profile of home ownership, and the mortgage de...

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Autore principale: Martinez, Leonardo
Altri autori: Hatchondo, Juan Carlos, Sanchez, Juan
Natura: Periodico
Lingua:English
Pubblicazione: Washington, D.C. : International Monetary Fund, 2012.
Serie:IMF Working Papers; Working Paper ; No. 2012/026
Accesso online:Full text available on IMF
Descrizione
Riassunto:This paper incorporates house price risk and mortgages into a standard incomplete market (SIM) model. The model is calibrated to match U.S. data and accounts for non-targeted features of the data such as the distribution of down payments, the life-cycle profile of home ownership, and the mortgage default rate. The average coefficients that measure the agents' ability to self-insure against income shocks are similar to those of a SIM model without housing but housing increases the values of these coefficients for younger agents. The response of consumption to house price shocks is minimal. The introduction of minimum down payments or income garnishment benefits a majority of the population.
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Descrizione fisica:1 online resource (33 pages)
Natura:Mode of access: Internet
ISSN:1018-5941
Accesso:Electronic access restricted to authorized BRAC University faculty, staff and students