The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

US Mortgage and Foreclosure Law

  • Zachary K. Kimball
  • Paul S. Willen
Reference work entry


A mortgage is an exchange of a collection of rights between a borrower and a lender. In this article, we describe those rights and explain both their economic logic and their implications for economic analysis and policy. We briefly discuss the medieval origins of the American mortgage contract and its evolution into its present form. We then turn to topics relevant for contemporary economic research – including title and lien theory; recording and registration of documents; judicial versus power-of-sale foreclosure; deficiency judgments and recourse; assignments; the Mortgage Electronic Registration System; and methods for avoiding foreclosure, including deeds-in-lieu and short sales. Our discussion focuses on real property law and its economic implications; we do not discuss, for example, securities law related to mortgage contracts.


Equity Default Foreclosure Housing Law and economics Mortgage Residential real estate and finance 

JEL Classifications

G21 G22 G28 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Zachary K. Kimball
    • 1
  • Paul S. Willen
    • 1
  1. 1.