Can I read Financial Fragility with SAM? on EtoBox?

Financial Fragility with SAM? by DANIEL L. GREENWALD; TIM LANDVOIGT; STIJN VAN NIEUWERBURGH is a Economics, Econometrics and Finance article available to read on EtoBox.

What is Financial Fragility with SAM? about?

Shared Appreciation Mortgages feature mortgage payments that adjust with house prices. They are designed to stave off borrower default by providing payment relief when house prices fall. Some argue that SAMs may help prevent the next foreclosure crisis. However, home owners' gains from payment relief are mortgage lenders' losses. A general equilibrium model in which financial intermediaries channel savings from saver to borrower households shows that indexation of mortgage payments to aggregate house prices increases financial fragility, reduces risk-sharing, and leads to expensive financial sector bailouts. In contrast, indexation to local house prices reduces financial fragility and improves risk-sharing.

Who reads Financial Fragility with SAM??

Author

DANIEL L. GREENWALD; TIM LANDVOIGT; STIJN VAN NIEUWERBURGH

Publisher

John Wiley and Sons; Wiley (Blackwell Publishing); Blackwell Publishing Inc.; Wiley; JSTOR (ISSN 0022-1082)

Published

2020

Language

EN

Field

Economics, Econometrics and Finance (Social Sciences)