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A look back: what we now know about the causes of the US mortgage crisis

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  • Dan Immergluck

Abstract

This article reviews what we know about the causes of the US mortgage crisis, almost a decade after the crisis began. The paper summarizes the key forces that led to the crisis or, in some cases, to the development of a fundamentally fragile mortgage market, whose vulnerability helped enable the crisis. While some factors, such as federal policies pre-empting state consumer protection laws, were near-term spurs to higher levels of subprime lending, others - such as the migration of lending activity from savings and loans to less regulated mortgage companies - led to the development of a mortgage market that was more risk-loving, less regulated, and more prone to cataclysmic failure.

Suggested Citation

  • Dan Immergluck, 2015. "A look back: what we now know about the causes of the US mortgage crisis," International Journal of Urban Sciences, Taylor & Francis Journals, vol. 19(3), pages 269-285, November.
  • Handle: RePEc:taf:rjusxx:v:19:y:2015:i:3:p:269-285
    DOI: 10.1080/12265934.2015.1044460
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    References listed on IDEAS

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    1. Atif Mian & Amir Sufi, 2008. "The Consequences of Mortgage Credit Expansion: Evidence from the 2007 Mortgage Default Crisis," NBER Working Papers 13936, National Bureau of Economic Research, Inc.
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    3. Andra C. Ghent & Rubén Hernández-Murillo & Michael T. Owyang, 2015. "Did Affordable Housing Legislation Contribute to the Subprime Securities Boom?," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 43(4), pages 820-854, November.
    4. Agarwal, Sumit & Amromin, Gene & Ben-David, Itzhak & Chomsisengphet, Souphala & Evanoff, Douglas D., 2014. "Predatory lending and the subprime crisis," Journal of Financial Economics, Elsevier, vol. 113(1), pages 29-52.
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    6. Adam B. Ashcraft & Paul Goldsmith-Pinkham & James Vickery, 2010. "MBS ratings and the mortgage credit boom," Staff Reports 449, Federal Reserve Bank of New York.
    7. Atif Mian & Amir Sufi, 2008. "Summary of \"the consequences of mortgage credit expansion\"," Proceedings 1074, Federal Reserve Bank of Chicago.
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    Cited by:

    1. Michelle Norris & Michael Byrne, 2016. "Social housing's role in the Irish property boom and bust," Working Papers 201615, Geary Institute, University College Dublin.
    2. Nelson, John P., 2023. "Differential “progressibility” in human know-how: A conceptual overview," Research Policy, Elsevier, vol. 52(2).
    3. Michelle Norris & Michael Byrne, 2017. "Housing Market Volatility,Stability and Social Rented Housing: comparing Austria and Ireland during the global financial crisis," Working Papers 201705, Geary Institute, University College Dublin.
    4. Yifei Wu & Jeffrey H Dorfman, 2018. "Reducing residential mortgage default: Should policy act before or after home purchases?," PLOS ONE, Public Library of Science, vol. 13(7), pages 1-23, July.

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