Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments June 5, 2019 erstellt
Description:
Post-crisis policy interventions significantly increased the demand for mortgage refinancing, but there is an unexplored possibility that the surge in refinancing applications has crowded out the supply of credit to home buyers. In this paper, we examine two frictions that hamper financial intermediation and cause banks to substitute home purchase loans for refinance loans. If banks are constrained by risk capacity, they may prefer safer loans. If banks are constrained by operating capacity, they may prefer applications that require less processing time. We find that following the recent financial crisis, banks constrained by these capacity limits rationed credit to home buyers while supplying greater refinance credit