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Interest-only and longer-term mortgages: easier access, more risk

Lunde, Jens, Scanlon, Kathleen ORCID: 0000-0001-9957-4853 and Whitehead, Christine M E (2008) Interest-only and longer-term mortgages: easier access, more risk. In: Sciamarelli, Alessandro, McDowell, Malcolm and Labadie, Rodolfo, (eds.) Hypostat 2007: a review of Europe’s mortgage and housing markets. European Mortgage Federation, Brussels, Belgium, pp. 9-13.

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As most people are all too aware, over the last twenty years mortgage markets have been liberalised in many western European countries as part of the more general globalisation of finance markets: restrictions on the use and terms of loans have been lessened, and a wider range of financial institutions is now permitted to offer mortgages. Consumers clearly enjoy much greater choice than they had in the days when a mortgage meant a straight annuity loan with a 25-year term and a significant minimum down payment. Conversely, this expanded range of choice makes much greater demands on consumers’ financial acumen, and has generally increased market and credit risk (for the individual borrowers, lenders and society as a whole).

Item Type: Book Section
Official URL:
Additional Information: © 2008 European Mortgage Federation
Divisions: Economics
Spatial Economics Research Centre
LSE London
Subjects: H Social Sciences > HB Economic Theory
Date Deposited: 17 Mar 2014 09:33
Last Modified: 15 Sep 2023 09:30

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