The authors are, respectively, Visiting Associate Professor of Finance at the University of Southern California and the University of Utah and Associate Professor of Finance at the University of Southern California. This research was sponsored and funded by Mortgage Guaranty Insurance Corporation. Views or judgments expressed here are those of the authors exclusively and do not necessarily reflect the views of present or past officers or employees of MGIC. Special thanks go to Gerald Friedman, Robert Rolli, William Ross and Robert Smith for support, assistance and comments and to Michael Brennan and George M. Von Furstenberg for helpful suggestions.
The Determinants of Default on Insured Conventional Residential Mortgage Loans
Article first published online: 30 APR 2012
1983 The American Finance Association
The Journal of Finance
Volume 38, Issue 5, pages 1569–1581, December 1983
How to Cite
CAMPBELL, T. S. and DIETRICH, J. K. (1983), The Determinants of Default on Insured Conventional Residential Mortgage Loans. The Journal of Finance, 38: 1569–1581. doi: 10.1111/j.1540-6261.1983.tb03841.x
- Issue published online: 30 APR 2012
- Article first published online: 30 APR 2012
This paper presents empirical evidence on the determinants of default for insured residential mortgages. A multinomial logit model is specified and estimated for regional aggregates constructed from cross sectional and time series data. The results document the independent statistical significance of contemporaneous payment/income and loan/ value ratios and unemployment rates as well as more commonly studied determinants of default such as age and the original loan/value ratio.