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Refinancing Frictions, Mortgage Pricing and Redistribution / David W. Berger, Konstantin Milbradt, Fabrice Tourre, Joseph S. Vavra.
- Format:
- Book
- Author/Creator:
- Berger, David W.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w32022.
- NBER working paper series no. w32022
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2024.
- Summary:
- There are large cross-sectional differences in how often US borrowers refinance mortgages. In this paper, we develop an equilibrium mortgage pricing model with heterogeneous borrowers and use it to show that equilibrium forces imply important cross-subsidies from borrowers who rarely refinance to those who refinance often. Mortgage reforms can potentially reduce these regressive cross-subsidies, but the equilibrium effects of these reforms can also have important distributional consequences. For example, many policies that lead to more frequent refinancing also increase equilibrium mortgage rates and thus reduce residential mortgage credit access for a large number of borrowers.
- Notes:
- Print version record
- January 2024.
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