2017
DOI: 10.2139/ssrn.3055240
|View full text |Cite
|
Sign up to set email alerts
|

The Impact of Interest-Only Loans on Affordability

Help me understand this report

Search citation statements

Order By: Relevance

Paper Sections

Select...
1

Citation Types

0
1
0

Year Published

2020
2020
2020
2020

Publication Types

Select...
3

Relationship

0
3

Authors

Journals

citations
Cited by 3 publications
(1 citation statement)
references
References 21 publications
0
1
0
Order By: Relevance
“…Indeed, households with low exposure also use IO mortgages and their consumption may well increase due to lower savings. In particular, an important consideration is the general equilibrium effect of the reform, particularly with regards to the dramatic increase in house prices that followed the introduction of interest-only mortgages (Bäckman and Lutz, 2018). IO mortgages can be valuable for paymentconstrained borrowers, and these borrowers could use the increase in borrowing to bid up prices, which would lead to higher collateral values and affect the borrowing of households facing leverage constraints.…”
Section: Discussion Of Aggregate Level Resultsmentioning
confidence: 99%
“…Indeed, households with low exposure also use IO mortgages and their consumption may well increase due to lower savings. In particular, an important consideration is the general equilibrium effect of the reform, particularly with regards to the dramatic increase in house prices that followed the introduction of interest-only mortgages (Bäckman and Lutz, 2018). IO mortgages can be valuable for paymentconstrained borrowers, and these borrowers could use the increase in borrowing to bid up prices, which would lead to higher collateral values and affect the borrowing of households facing leverage constraints.…”
Section: Discussion Of Aggregate Level Resultsmentioning
confidence: 99%