The Role of Government and Private Institutions in Credit Cycles in the U.S. Mortgage Market

Manuel Adelino, W. Ben McCartney, Antoinette Schoar B

2020

Full text Open access: Gold Metadata (CSL-JSON)

DOI 10.21799/frbp.wp.2020.40

Data confidence 70 medium

How this score is calculated

It is built from checkable properties of the record itself: whether the article has a DOI, how many independent sources confirmed its data, whether the required fields are filled in, and how recent the latest confirmation is. Disagreement between sources and a missing identifier lower it. A value of 80 or above means the record was published without further checking; 60 to 79 means it is published at reduced confidence, with a manual check advisable. A record verified by an editor by hand is never pushed below 90 by a recalculation. This scores our data about the article, not the article itself.

Abstract

The distribution of combined loan-to-value ratios (CLTVs) for purchase mortgages has been remarkably stable in the U.S. over the last 25 years.But the source of high-CLTV loans changed during the housing boom of the 2000s, with private securitization replacing FHA and VA loans directly guaranteed by the government.This substitution holds within ZIP codes, properties, and borrower types.Furthermore, the two groups exhibit similar delinquency rates.These findings suggest credit expanded predominantly through the increase in asset values rather than a relaxation of CLTV constraints, which supports models of the collateral channel or broad changes in house price expectations.