Marsh Feldman writes > (3) Because the homeowner has some equity to lose, the > Bank is more willing to believe a homeowner will eventually > catch up in payments. I see your point. Maybe a renter can get away without paying rent for 2 months while a homeowner might get by not making mortgage payments for 5 months. But still, the loss experienced by the homeowner would be much greater at the end of 5 months as all the equity is lost. I guess it depends on how the two factors (longer time to get away with not paying the mortgage + big loss if no job found after 5 months unemployed). FYI, during the golden age (1954-1964) the average time a job loser was without a job was about 5 1/2 months. This seems almost long enough for a homeowner to face foreclosure. And, as this is the average, many experience longer spells of job loss than this. In the Reagan/postReagan years the average spell of unemployment has been about 6 months for an unemployed job loser. I wonder how long the average time to foreclosure is after mortgage payments have been stopped? Eric Nilsson Department of Economics California State University San Bernardino, CA 92407 [EMAIL PROTECTED]
