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Journal Article
Private Efforts for Affordable Mortgage Lending Before Fannie and Freddie
Prior to government interventions in the U.S. mortgage market during the 1930s, private institutions arose to improve the efficiency of the market and produce more affordable mortgage products. These institutions included mortgage companies that made significant use of mortgage securitization, building and loan associations, and life insurance company mortgage operations. These developments allowed for the creation of geographically more diversified mortgage portfolios while working to address the difficulties of maintaining effective oversight of local lending agents. They may be suggestive ...
Briefing
It's a Wonderful Loan: A Short History of Building and Loan Associations
Prior to the advent of modern home mortgage markets in the United States, markets in which mortgage-backed securities and government-sponsored enterprises now play significant roles, prospective homebuyers had to rely on other mechanisms of home finance. For about a century, cooperative organizations known as building and loan associations, a concept imported from Britain, served millions of American savers and homebuyers.
Working Paper
Financial Failure and Depositor Quality: Evidence from Building and Loan Associations in California
Flightiness, or depositor sensitivity to liquidity needs, can be an important determinant of financial distress. I leverage institutional differences that attract depositors with varying flightiness across building and loan associations in California during the Great Depression. A new type of plan, the Dayton plan, involved less restrictive savings plans and lower withdrawal penalties. Dayton plans in California were more likely to close during the Great Depression. Archival evidence on lending rates and returns supports the flightiness mechanism.