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dc.contributor.authorMorgan, Donald P.en_US
dc.contributor.authorIverson, Benjaminen_US
dc.contributor.authorBotsch, Matthewen_US
dc.date.accessioned2010-04-30en_US
dc.date.accessioned2012-08-17T14:38:36Z-
dc.date.available2012-08-17T14:38:36Z-
dc.date.issued2009en_US
dc.identifier.urihttp://hdl.handle.net/10419/60960-
dc.description.abstractWe argue that the 2005 bankruptcy abuse reform (BAR) contributed to the surge in subprime foreclosures that followed its passage. Before BAR, over-indebted mortgagors could free up income to pay the mortgage by filing bankruptcy and having their unsecured debts discharged. BAR blocks that maneuver for better-off filers by way of a means test. We identify the effects of BAR using state home equity bankruptcy exemptions; filers in low-exemption states were not very protected before BAR, so they would be less affected by the reform. Difference-in-difference regressions confirm four predictions implied by that identification strategy. Our findings add to research trying to explain the surge in subprime foreclosures and to a broader literature on household bankruptcy demand and credit supply.en_US
dc.language.isoengen_US
dc.publisherFederal Reserve Bank of New York New York, NYen_US
dc.relation.ispartofseriesStaff Report, Federal Reserve Bank of New York 358en_US
dc.subject.jelG21en_US
dc.subject.jelG33en_US
dc.subject.jelK35en_US
dc.subject.ddc330en_US
dc.subject.keywordBankruptcyen_US
dc.subject.keywordsubprime foreclosuresen_US
dc.subject.keywordsubprime mortgagesen_US
dc.subject.keywordunsecured debten_US
dc.subject.keywordcredit card debten_US
dc.subject.keywordhome equity exemptionsen_US
dc.subject.keywordcram-downen_US
dc.titleSeismic effects of the bankruptcy reformen_US
dc.typeWorking Paperen_US
dc.identifier.ppn593786254en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
Appears in Collections:Staff Reports, Federal Reserve Bank of New York

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