Search Results

Showing results 1 to 10 of approximately 12.

(refine search)
SORT BY: PREVIOUS / NEXT
Keywords:Delinquency 

Working Paper
Consumption in the Great Recession: The Financial Distress Channel

During the Great Recession, the collapse of consumption across the U.S. varied greatly but systematically with house-price declines. We find that financial distress among U.S. households amplified the sensitivity of consumption to house-price shocks. We uncover two essential facts: (1) the decline in house prices led to an increase in household financial distress prior to the decline in income during the recession, and (2) at the zip-code level, the prevalence of financial distress prior to the recession was positively correlated with house-price declines at the onset of the recession. Using ...
Working Papers , Paper 2019-25

Working Paper
Consumption in the Great Recession: The Financial Distress Channel

During the Great Recession, the collapse of consumption across the U.S. varied greatly but systematically with house-price declines. We find that financial distress among U.S. households amplified the sensitivity of consumption to house-price shocks. We uncover two essential facts: (1) the decline in house prices led to an increase in household financial distress prior to the decline in income during the recession, and (2) at the zip-code level, the prevalence of financial distress prior to the recession was positively correlated with house-price declines at the onset of the recession. Using ...
Research Working Paper , Paper RWP 19-6

Working Paper
Minimum Wages and Consumer Credit : Impacts on Access to Credit and Traditional and High-Cost Borrowing

Proponents of minimum wage legislation point to its potential to raise earnings and reduce poverty, while opponents argue that disemployment effects lead to net welfare losses. But these arguments typically ignore the possibility of spillover effects on other aspects of households' financial circumstances. This paper examines how state-level minimum wages affect the decisions of lenders and low-income borrowers. Using data derived from direct mailings of credit offers, survey-reported usage of high-cost alternative credit products, and debt recorded in credit reports, we find that higher ...
Finance and Economics Discussion Series , Paper 2017-010

Working Paper
Stress Testing Household Debt

We estimate a county-level model of household delinquency and use it to conduct "stress tests" of household debt. Applying house price and unemployment rate shocks from Comprehensive Capital Analysis Review (CCAR) stress tests, we find that forecasted delinquency rates for the recent stock of debt are moderately lower than for the stock of debt before the 2007-09 financial crisis, given the same set of shocks. This decline in expected delinquency rates under stress reflects an improvement in debt-to-income ratios and an increase in the share of debt held by borrowers with relatively high ...
Finance and Economics Discussion Series , Paper 2019-008

Working Paper
Consumption in the Great Recession: The Financial Distress Channel

During the Great Recession, the collapse of consumption across the US varied greatly but systematically with house-price declines. Our message is that household financial health matters for understanding this relationship. Two facts are essential for our finding: (1) the decline in house prices led to an increase in household financial distress (FD) prior to the decline in income during the recession, and (2) at the zip-code level, the prevalence of FD prior to the recession was positively correlated with house-price declines at the onset of the recession. We measure the power of the ...
Working Paper , Paper 19-13

Blog
How will COVID-19 Affect Financial Assets, Delinquency and Bankruptcy?

Communities with greater financial distress will face larger income shocks caused by COVID-19 and are less prepared to weather them, while also being more likely to go into further financial distress as the pandemic continues.
On the Economy

Blog
Ready for the Pandemic? Household Debt before the COVID-19 Shock

Before the pandemic, shares of delinquencies had already been growing in consumer finance loans, credit card debt, student loans and auto loans. And delinquencies can vary greatly among states.
On the Economy

Blog
Three Reasons Why Millennials May Face Devastating Setback from COVID-19

Will the millennial generation, already known for its financial struggles in the wake of the Great Recession, face a devastating financial setback from the coronavirus pandemic?
On the Economy

Working Paper
The Impact of Missed Payments and Foreclosures on Credit Scores

This paper debunks the common perception that ?foreclosure will ruin your credit score.? Using individual-level data from a credit bureau matched with loan-level mortgage data, it is estimated that the very first missed mortgage payment leads to the biggest reduction in credit scores. The effects of subsequent loan impairments are increasingly muted. Post-delinquency foreclosures have only a minimal effect on credit scores. Moreover, credit scores improve substantially a year after borrowers experience 90-day delinquency or foreclosure. The data supports one possible explanation of this ...
Working Papers (Old Series) , Paper 1423

Working Paper
Household Financial Distress and the Burden of ‘Aggregate’ Shocks

In this paper we show that household-level financial distress (FD) varies greatly and can increase vulnerability to economic shocks. To do this, we establish three facts: (i) regions in the United States vary significantly in their “FD-intensity,” measured either by how much additional credit households can access or how delinquent they are on debts, (ii) shocks that are typically viewed as “aggregate” in nature hit geographic areas quite differently, and (iii) FD is an economic “pre-existing condition”: the share of an aggregate shock borne by a region is positively correlated ...
Research Working Paper , Paper RWP 20-13

FILTER BY year

FILTER BY Content Type

Working Paper 9 items

Blog 3 items

FILTER BY Jel Classification

D31 6 items

D58 6 items

E21 6 items

E44 6 items

G11 6 items

G21 6 items

show more (10)

FILTER BY Keywords

PREVIOUS / NEXT