The Post-Foreclosure Experience of US Households in the Current Housing Market Downturn
Posted: 1 Dec 2010 Last revised: 9 Dec 2010
The flood of foreclosures on residential mortgages in the past several years has had a significant impact on household finances, housing markets, and financial markets. To date, however, little is known about what happens to the borrower’s household after their mortgage has been foreclosed. In this paper, we study the post-foreclosure experience of U.S. households using a unique dataset based on the credit reports of a large panel of individuals to from 1999 to 2010. We examine the effect of foreclosure on household size and migration patterns, including the distance that a household typically moves and the characteristics of their new neighborhood. We compare these outcomes to households with similar demographic, geographic, and economic characteristics but that did not experience a foreclosure.
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