Curtailment as a mortgage performance indicator

Markets and housing finance

“…As there is yet to be a standardized methodology for collecting data on housing finance, we cannot vouch for the quality of the data. Moreover, the data are Sources: Scanlon and Whitehead (2004), Calhoun (2005), Erbas and Nothaft, 2005; Hoek-Smit (2005), Zhu (2006), Low et al (2003), Ong (2005), Hegedüs and Struyk (2005), BIS (2006), Brounen et al (2006), Green and Wachter (2005), Lin and Yang (2005), Tiwari and Moriizumi (2003), National Association of Realtors (2000a,b), IMF (2006), European Mortgage Federation (2005), Sheppard (2007). Note that the coding of ''Mostly fixed or Variable" is not always straightforward; thus the entries in that column should be seen as indicative but not necessarily exact.…”

Deleveraging and mortgage curtailment

“…32 Additionally, the presence of a prepayment penalty should lower the likelihood of a full prepayment, due to the large financial penalties that would result from such a decision.…”

“…We use a series 32 Most curtailment amount are far below the 20% repayment penalty threshold; therefore borrowers with a prepayment penalty will not penalized for engaging in curtailment behavior. 33 As measured by percentage of loans in the BBx population serviced by a given institution.…”

Barriers to homeownership and housing quality: The impact of the international mortgage market

“…As a consequence, it is important to examine how prepayment actually occurs in diVerent economies. Lin and Yang (2005) examine the impact of mortgage curtailment behaviors on the subsequent default and prepayment performance. They utilize a sample of loan-level mortgage performance records from Taiwan and employ a multinomial logit regression that indicates that curtailment is one of the most signiWcant factors in predicting future default and prepayment probabilities of a seasoned mortgage pool.…”