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Even a small rise in interest rates would hurt borrowers, increase bad debts and perhaps even spur fire-sales of homes.
But the owners are unlikely to reduce their spending by as much as the borrowers increase theirs, especially since Fannie, Freddie and the Federal Reserve are among the largest owners.
We observe that the number of granted loans decreases in bad times and, at the same time, the risk quality of the borrowers increase.
Similar(54)
The number of student borrowers increased 54 percent from 2005 to 2012, while the average debt per borrower increased 56 percent, to $25,000.
The states where the percentage of severely delinquent borrowers increased the most over the last year include Rhode Island, Illinois and Michigan.
In contrast, the number of white borrowers barely decreased in 2007, and the number of Asian-American borrowers increased by 6percentt.
The so-called subprime category, loans that have higher interest rates because of weaker credit histories by borrowers, increased substantially in the last years as housing values soared.
Naturally, defaults by corporate borrowers increased when the economy turned down: the rate of written-off loans more than tripled between 1999 and 2002.
The number of borrowers increased markedly because of increased financial activity and sound and stable economic conditions in mid-2000s.
Furthermore, while its mortgage lending to white borrowers increased, it dropped dramatically for African-American and Hispanic borrowers.
Increase in the age of the borrower increase the per month income earned by the households.
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