Turmoil in the Residential Mortgage Market, a Review and Compilation of Research and Policy

43 Pages Posted: 2 Jun 2009

See all articles by Brent C. Smith

Brent C. Smith

Virginia Commonwealth University

Date Written: January 2, 2009

Abstract

Although the 30-year fixed rate loan is the standard in the U.S. mortgage market the interest rate risk is borne by holder of the note. This risk, and myriad other motivations fostered the development of the subprime and Alt-A instruments that together have become the bane of the housing market. Neither is likely to return as viable instruments, but the need for risk based pricing will return as the housing cycle returns. For this reason it is valuable to examine the academic research on unconventional loans as policy and future research advances.

Keywords: housing, subprime, mortgage, default, foreclosure

Suggested Citation

Smith, Brent C., Turmoil in the Residential Mortgage Market, a Review and Compilation of Research and Policy (January 2, 2009). Available at SSRN: https://ssrn.com/abstract=1413262 or http://dx.doi.org/10.2139/ssrn.1413262

Brent C. Smith (Contact Author)

Virginia Commonwealth University ( email )

1015 Floyd Avenue
Richmond, VA 23284
United States

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