Europe May Provide Lessons on Preventing Mortgage Defaults

The Regional Economist

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Date Published
Primary Author Juan Carlos Hatchondo, Leonardo Martinez and Juan M. Sánchez
Other Authors
Theme Comparing Housing Finance Systems


It is well-known that house prices declined sharply and mortgage defaults increased abruptly from 2006 to 2010 in the U.S. In Europe, where mortgage regulations are significantly different, the behavior of house prices and mortgage defaults displays somewhat different dynamics. Comparing the experiences in these two regions sheds light on the impact of alternative regulations.

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