We use variation in mortgage modifications to disentangle the impact of reducing long-term obligations with no change in short-term payments (“wealth”), and reducing short-term payments with approximately no change in long-term obligations (“liquidity”). Using regression discontinuity and difference-in-differences research designs with administrative data measuring default and consumption, we find that principal reductions that increase housing wealth without affecting liquidity have no effect, while maturity extensions that increase only liquidity have large effects. Our results suggest that liquidity drives borrower default and consumption decisions, and that distressed debt restructurings can be redesigned with substantial gains to borrowers, lenders, and taxpayers.

中文翻译：

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家庭债务负担中的流动性与财富：大衰退中住房政策的证据

我们使用抵押贷款变更的变化来消除减少长期债务而短期付款（“财富”）不变的影响，减少减少短期付款而长期债务却没有变化（“流动性”）的影响。 。使用回归不连续性和差异差异研究设计以及测量违约和消费的行政数据，我们发现增加本钱而不影响流动性的本金减少没有影响，而仅增加流动性的期限延长具有重大影响。我们的结果表明，流动性驱动着借款人违约和消费决策，不良的债务重组可以通过重新设计而为借款人，贷方和纳税人带来可观的收益。