![]() The prime borrower share averages around 60 percent and did not decline during the housing boom. The authors suggest that one reason for this pattern is that the number of prime borrowers dwarfs that of subprime borrowers and the other borrower/owner categories they consider. Twice as many prime borrowers as subprime borrowers lost their homes over the full sample period. Between 20, 656,003 more prime than subprime borrowers lost their homes. This small difference was reversed by the beginning of 2009. In this period 39,094 more subprime than prime borrowers lost their homes. There were only seven quarters, all concentrated at the beginning of the housing market bust, when more homes were lost by subprime than by prime borrowers. It began that way, but quickly expanded into a much broader phenomenon dominated by prime borrowers' loss of homes. The researchers find that the crisis was not solely, or even primarily, a subprime sector event. ![]() Their data contain information on over 33 million unique ownership sequences in just over 19 million distinct owner-occupied housing units from 1997�2012. They employ microdata that track outcomes well past the beginning of the crisis and cover all types of house purchase financing-prime and subprime mortgages, Federal Housing Administration (FHA)/Veterans Administration (VA)-insured loans, loans from small or infrequent lenders, and all-cash buyers. 21261), Fernando Ferreira and Joseph Gyourko provide new facts about the foreclosure crisis and investigate various explanations of why homeowners lost their homes during the housing bust. Foreclosure Crisis: Panel Data Evidence of Prime and Subprime Borrowers from 1997 to 2012 (NBER Working Paper No. Many studies also focus on the period leading up to 2008, even though most foreclosures occurred subsequently. housing market, usually about 15 percent and never more than 21 percent. Yet subprime loans comprise a relatively small share of the U.S. Many studies of the housing market collapse of the last decade, and the associated sharp rise in defaults and foreclosures, focus on the role of the subprime mortgage sector. The crisis began in the subprime mortgage sector, but twice as many prime borrowers as subprime borrowers lost their homes over the full sample period.
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