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Economic Brief

January 2013, No. 13-01

All Mortgages Are Not Created Equal

Karl Rhodes and Breck Robinson

Housing experts have studied the relative performance of different types of mortgages during the housing crisis. But foreclosure analysis often overlooks distinctions between mortgages issued to occupant owners and those issued to non-occupant owners. This Economic Brief highlights the impact of non-occupant-owner mortgages on the housing crisis.

Additional Resources

Foote, Christopher L., Kristopher Gerardi, and Paul S. Willen, "Negative Equity and Foreclosure: Theory and Evidence," Journal of Urban Economics, September 2008, vol. 64, no. 2, pp. 234–245. (A working paper version is available online.)

Immergluck, Dan, and Geoff Smith, "Risky Business — An Econometric Analysis of the Relationship Between Subprime Lending and Neighborhood Foreclosures," Manuscript, Woodstock Institute, March 2004.

Kau, James B., and Donald C. Keenan, "An Overview of the Option-Theoretic Pricing of Mortgages," Journal of Housing Research, 1995, vol. 6, no. 2, pp. 217–244. (Article available online with subscription.) 

Robinson, Breck L., "The Performance of Non-Owner-Occupied Mortgages during the Housing Crisis," Federal Reserve Bank of Richmond Economic Quarterly, Second Quarter 2012, vol. 98, no. 2, pp. 111–138.

Vandell, Kerry D., "How Ruthless is Mortgage Default? A Review and Synthesis of the Evidence," Journal of Housing Research, 1995, vol. 6, no. 2, pp. 245–264. (Article available online with subscription.)

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