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Mortgage Market Turmoil: The Role of Interest-Rate Resets
James R. Barth, Tong Li, Triphon Phumiwasana, and Glenn Yago
December
2007
Publisher: Milken Institute
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The third in a four-part series on subprime mortgage data research, this paper examines hybrid mortgage products, assessing the role of hybrid mortgage in total forclosures against other products in the mortgage market.
In addition to showing that the total number of prime mortgage foreclosures is slightly higher than the total number of subprime mortgage forclosures, the data demonstrate that without home price increases, hybrid loans will indeed worsen the foreclosure problem, but they are not the cause of it.
For more on the subprime market series, please see:
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