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|Title:||Risk sharing in mortgage loan agreements||Authors:||Har, N.P.
|Issue Date:||2004||Citation:||Har, N.P.,Eng, O.S. (2004). Risk sharing in mortgage loan agreements. Review of Pacific Basin Financial Markets and Policies 7 (2) : 233-258. ScholarBank@NUS Repository. https://doi.org/10.1142/S0219091504000135||Abstract:||This paper examines whether risk sharing exists in mortgage loan agreements. Specifically, we analyze the effect of the number of co-borrowers on foreclosure risk, using data from Singapore. Through the estimation of probit model, the results consistently show that co-borrowers significantly reduce the foreclosure risk, suggesting the existence of risk sharing among the co-borrowers. In addition, foreclosure risk is reduced proportionately with the number of co-borrowers. Further analysis shows that low-rise properties required a larger number of co-borrowers than high-rise properties in order to share risk effectively. Interestingly, low-rise properties experience a greater decline in the foreclosure likelihood than high-rise properties for every increase in the number of co-borrowers. © World Scientific Co. and Center for Pacific Basin BEF Research.||Source Title:||Review of Pacific Basin Financial Markets and Policies||URI:||http://scholarbank.nus.edu.sg/handle/10635/46233||ISSN:||02190915||DOI:||10.1142/S0219091504000135|
|Appears in Collections:||Staff Publications|
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