EconStor >
Federal Reserve Bank of Boston >
Public Policy Discussion Papers, Federal Reserve Bank of Boston >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/59221
  
Title:Do borrower rights improve borrower outcomes? Evidence from the foreclosure process PDF Logo
Authors:Gerardi, Kristopher
Lambie-Hanson, Lauren
Willen, Paul S.
Issue Date:2011
Series/Report no.:Public policy Discussion Papers, Federal Reserve Bank of Boston 11-9
Abstract:The authors evaluate laws designed to protect borrowers from foreclosure. They find that these laws delay but do not prevent foreclosures. They first compare states that require lenders to seek judicial permission to foreclose with states that do not. Borrowers in judicial states are no more likely to cure and no more likely to renegotiate their loans, but the delays lead to a buildup in these states of persistently delinquent borrowers, the vast majority of whom eventually lose their homes. They next analyze a right-to-cure law instituted in Massachusetts on May 1, 2008. Using a difference-in-differences approach to evaluate the effect of the policy, they compare Massachusetts with neighboring states that did not adopt similar laws. They find that the right-to-cure law lengthens the foreclosure timeline but does not lead to better outcomes for borrowers.
Subjects:foreclosure
mortgage
judicial
power of sale
right to cure
JEL:G21
K11
R31
Document Type:Working Paper
Appears in Collections:Public Policy Discussion Papers, Federal Reserve Bank of Boston

Files in This Item:
File Description SizeFormat
682890243.pdf423.22 kBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/59221

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.