The Right Tool for the Job? Mortgage Distress and Personal Insolvency during the European Debt Crisis

By Wolfgang Bergthaler, Jose M Garrido, Anjum Rosha

May 5, 2023

Preview Citation

Format: Chicago

Wolfgang Bergthaler, Jose M Garrido, and Anjum Rosha. The Right Tool for the Job? Mortgage Distress and Personal Insolvency during the European Debt Crisis, (USA: International Monetary Fund, 2023) accessed December 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

The European debt crisis in the early to mid 2010s brought to the fore the issue of household debt distress: in the countries affected, widespread over-indebdtedness resulted in serious financial and social challenges. The crisis was primarily a mortgage debt crisis, but in several cases, the legal response was based on the introduction of personal insolvency procedures. This paper examines the challenges in designing and implementing legal reforms in this area to promote a better understanding of the main considerations in resolving personal insolvency and distressed mortgage debt in the context of crises. Lessons from the European crisis may prove valuable when dealing with the aftermath of the COVID-19 pandemic and the war in Ukraine on household debt distress.

Subject: Asset and liability management, Corporate insolvency, Debt settlement, Debt sustainability, External debt, Financial crises, Financial institutions, Financial sector policy and analysis, Mortgages, Solvency

Keywords: B. mortgage debt distress, Consumer debt, Consumer insolvency, Corporate insolvency, Debt settlement, Debt sustainability, Europe, Household debt, Household debt distress, Mortgage debt, Mortgage debt crisis, Mortgage distress, Mortgages, Solvency

Publication Details

Pages:

40
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2023/092
Stock No:

WPIEA2023092
ISBN:

9798400240928
ISSN:

1018-5941

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