Income Volatility and Residential Mortgage Delinquency: Evidence from 12EU Countries
Diaz-Serrano, Luis (2005) Income Volatility and Residential Mortgage Delinquency: Evidence from 12EU Countries. .
We Investigate the socio-economic determinants of mortgage delinquency in 12EU countries and observe that income volatility in income is high enough. From this result we can draw the following conclusions:i) mortgage protection insurance policies might be failing to cover those borrowers most in need; ii) the existence of credit market imperfection, and;iii) the inability for a number of borrowers most at income risk to accumulate precautionary savings in order to meet morgage payments when stocks in imcome rise.
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