IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/0918.html
   My bibliography  Save this paper

The Economics of Mortgage Terminations: Implications for Mortgage Lenders and Mortgage Terms

Author

Listed:
  • Patric H. Hendershott
  • Sheng Cheng Hu
  • Kevin E. Villani

Abstract

The paper begins with the development of models explaining the mortgage refinancing and assumption decisions of households Having identified the economic variables influencing these decisions, we then simulate the models for different values to determine under what conditions households will refinance or assume. Finally, we draw some implications of these results for: (1) the impact of a decline in mortgage rates on the asset portfolio yields of mortgage lending institutions and (2) the effect of the observed rise in interest rate volatility, including the optimal terminations response of mortgage borrowers, on the terms of the mortgage contract and the returns to mortgage lenders on recently issued mortgage loans.

Suggested Citation

  • Patric H. Hendershott & Sheng Cheng Hu & Kevin E. Villani, 1982. "The Economics of Mortgage Terminations: Implications for Mortgage Lenders and Mortgage Terms," NBER Working Papers 0918, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:0918
    Note: ME
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w0918.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Patric H. Hendershott & Sheng Hu, 1982. "Accelerating Inflation and Nonassumable Fixed-Rate Mortgages: Effects On Consumer Choice and Welfare," Public Finance Review, , vol. 10(2), pages 158-184, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Patric H. Hendershott, 1986. "Mortgage Pricing: What Have We Learned So Far?," NBER Working Papers 1959, National Bureau of Economic Research, Inc.
    2. John M. Harris, Jr. & G. Stacy Sirmans, 1987. "Discount Points, Effective Yields and Mortgage Prepayments," Journal of Real Estate Research, American Real Estate Society, vol. 2(2), pages 97-104.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Patric H. Hendershott, 1986. "Mortgage Pricing: What Have We Learned So Far?," NBER Working Papers 1959, National Bureau of Economic Research, Inc.
    2. Isaac F. Megbolugbe & Peter D. Linneman, 1993. "Home Ownership," Urban Studies, Urban Studies Journal Limited, vol. 30(4-5), pages 659-682, May.
    3. Michael J. Lea, 1982. "Housing Demand and the Standard Mortgage Instrument: Comment," Public Finance Review, , vol. 10(2), pages 185-192, April.
    4. Dietz, Robert D. & Haurin, Donald R., 2003. "The social and private micro-level consequences of homeownership," Journal of Urban Economics, Elsevier, vol. 54(3), pages 401-450, November.
    5. Gavin A. Wood, 1990. "The Tax Treatment of Housing: Economic Issues and Reform Measures," Urban Studies, Urban Studies Journal Limited, vol. 27(6), pages 809-830, December.
    6. Patric H. Hendershott & James D. Shilling, 1982. "Capital Allocation and the Economic Recovery Tax Act of 1981," Public Finance Review, , vol. 10(2), pages 242-273, April.
    7. Gatzlaff, Dean H. & Haurin, Donald R., 1998. "Sample Selection and Biases in Local House Value Indices," Journal of Urban Economics, Elsevier, vol. 43(2), pages 199-222, March.
    8. Richard K. Green & Patric H. Hendershott, 2001. "Home-ownership and Unemployment in the US," Urban Studies, Urban Studies Journal Limited, vol. 38(9), pages 1509-1520, August.
    9. Paul Flatau & Matt Forbes & Patric H. Hendershott, 2003. "Homeownership and Unemployment: The Roles of Leverage and Public Housing," NBER Working Papers 10021, National Bureau of Economic Research, Inc.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:0918. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.