Price fall the main cause of subprime delinquency
A fall in house prices has been the single biggest contributor to the rise in subprime delinquency levels, research published by the San Francisco Federal Reserve finds.
The research investigates the importance of three different possible explanations for the rise in delinquency rates: a rise in the riskiness of the subprime borrowing pool, pockets of economic weakness and the recent history of house price appreciation followed by depreciation.
After controlling for current levels of
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