Predatory Lending Laws and the Cost of Credit

Real Estate Economics, Vol. 36, Issue 2, pp. 175-211, Summer 2008

37 Pages Posted: 8 May 2008

See all articles by Anthony Pennington-Cross

Anthony Pennington-Cross

Marquette University - Dept. of Finance

Giang Ho

University of California, Los Angeles (UCLA)

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.

Suggested Citation

Pennington-Cross, Anthony N. and Ho, Giang, Predatory Lending Laws and the Cost of Credit. Real Estate Economics, Vol. 36, Issue 2, pp. 175-211, Summer 2008, Available at SSRN: https://ssrn.com/abstract=1127943 or http://dx.doi.org/10.1111/j.1540-6229.2008.00211.x

Anthony N. Pennington-Cross (Contact Author)

Marquette University - Dept. of Finance ( email )

P.O. Box 1881
Milwaukee, WI 53201-1881
United States

Giang Ho

University of California, Los Angeles (UCLA) ( email )

405 Hilgard Avenue
Box 951361
Los Angeles, CA 90095
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
1
Abstract Views
1,723
PlumX Metrics