Topic: Default Option Exercise over the Financial Crisis and Beyond 

Speaker: Yongheng Deng, Provost’s Chair Professor, National University of Singapore

Date: September 27th (Wednesday)

Time: 10:00-11:30am

Location: Building 4, Room 101

Language: English

Abstract:

We document increased ruthlessness of mortgage default option exercise over the financial crisis. Findings show that the marked upturn in default option exercise was even more important to crisis period defaults than was the collapse in home equity. Analysis further indicates that much of the variation in default ruthlessness can be explained by the local business cycle, house price expectations, and consumer distress. Also, results suggest elevated default option exercise in the wake of enactment of crisis-period loan modification programs. 

About the speaker:

Professor Deng is Provost's Chair Professor of Real Estate and Finance at the National University of Singapore. He is also the Head of Real Estate at the Department of Real Estate, School of Design and Environment, and Professor in the Department of Finance at NUS Business School. He has served as the Director of the Institute of Real Estate Studies at NUS (2009-2017), the Director of the Lifecycle Financing Research Program at NUS Global Asia Institute (2012- ), and on the board of the management of the Asia Research Institute (2014-2016) at NUS.

Prior to joining NUS, he was a Professor at the University of Southern California (USC), School of Policy, Planning and Development, and the Marshall School of Business. He has also served as Economist and Expert in the Office of Federal Housing Enterprise Oversight (OFHEO) – a financial regulator overseeing Fannie Mae and Freddie Mac – in Washington DC. Professor Deng holds a Ph.D. in Economics from the University of California at Berkeley.