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- Title
Predatory Lending Laws and the Cost of Credit.
- Authors
Pennington-Cross, Anthony; Ho, Giang
- Abstract
Various states and other local jurisdictions have enacted laws intending to reduce predatory and abusive lending in the subprime mortgage market. These laws have created substantial geographic variation in the regulation of mortgage credit. This article examines whether these laws are associated with a higher or lower cost of credit. Empirical results indicate that the laws are associated with at most a modest increase in cost. However, the impact depends on the product type. In particular, loans with fixed (adjustable) rates are associated with a modest increase (decrease) in cost.
- Subjects
PREDATORY lending; BANKING laws; SUBPRIME mortgages; FIXED rate mortgages; ADJUSTABLE rate mortgages; VARIABLE rate loans
- Publication
Real Estate Economics, 2008, Vol 36, Issue 2, p175
- ISSN
1080-8620
- Publication type
Article
- DOI
10.1111/j.1540-6229.2008.00211.x