Interest Rate Pass-Through: Mortgage Rates, Household Consumption, and Voluntary Deleveraging

Interest Rate Pass-Through and Monetary Transmission: Evidence from Individual Financial Institutions’ Retail Rates

Official interest rate changes should influence short rates on money market instruments and retail products, such as deposit accounts and mortgages, but complete pass-through is often taken for granted. This paper provides a theoretical and econometric framework for assessing the evidence for this assumption using seventeen years of monthly data for rates on thirteen deposit and mortgage produc...

The Effects of Interest Rates on Mortgage Prepayments

Three main types of mortgages are fixed interest contracts which automatically fall due on the sale of a dwelling, fixed rate loans which are assumable by a buyer, and floating rate instruments. When interest rates rise, the fall in the economic value of these assets in savings and loan associations' portfolios varies from one form of mortgage to another. For either of the fixed interest rate c...

Household Consumption and Household Type: What Can We Learn from Mortgage Refinancing?

Debt deleveraging and the exchange rate

Article history: Received 28 March 2013 Received in revised form 4 March 2014 Accepted 4 March 2014 Available online 15 March 2014 JEL classification: F41

Consumption Habits and interest rate rigidity

In this paper we provide a micro model of loans which the lender is a monopolistic bank and the borrower is a competitive consumer with consumption habits who may default on part of his debt. In this setting, we prove that the loan demand curve is kinked and therefore it is possible to find interest rate rigidity in equilibrium as well as asymmetric response of loans to interest rate variations...