Grantmaking

This three-part project will empirically investigate the role of consumer protection laws on U.S. mortgage market outcomes and consumer welfare. Homeownership represents an important source of wealth for American families and is a primary source of wealth transfer across generations. But the housing crisis during the Great Recession disproportionately affected minorities and households at the lower end of the wealth distribution, precipitating calls for regulatory reform in mortgage markets to preserve the financial health of American households. Little evidence currently exists about the effect of particular legal regimes on the operation of the mortgage market. Specifically, this project asks whether laws providing new grounds for consumer or public enforcer lawsuits against mortgage providers can successfully improve consumer outcomes. Padi proposes to answer this question by looking at the effects of legislation and regulations passed in the states and assessing their impact by comparing results to those in neighboring states.