The Post-Foreclosure Experience of U.S. Households

40 Pages Posted: 9 Nov 2011

See all articles by Raven Molloy

Raven Molloy

Board of Governors of the Federal Reserve System

Hui Shan

Board of Governors of the Federal Reserve System

Date Written: May 2, 2011

Abstract

Despite the recent flood of foreclosures on residential mortgages, little is known about what happens to borrowers and their households after their mortgage has been foreclosed. 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. Although foreclosure considerably raises the probability of moving, the majority of post-foreclosure migrants do not end up in substantially less desirable neighborhoods or more crowded living conditions. These results suggest that, on average, foreclosure does not impose an economic burden large enough to severely reduce housing consumption.

Keywords: Foreclosure, migration, household formation, housing consumption

JEL Classification: G21, J60, R23, R30

Suggested Citation

Molloy, Raven and Shan, Hui, The Post-Foreclosure Experience of U.S. Households (May 2, 2011). FEDS Working Paper No. 2011-32. Available at SSRN: https://ssrn.com/abstract=1956706 or http://dx.doi.org/10.2139/ssrn.1956706

Raven Molloy (Contact Author)

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

Hui Shan

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States
(202) 452 3491 (Phone)
(202) 728 5887 (Fax)

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