Did the Furlough Scheme and Mortgage Holidays Prevent Mortgage Default?

新冠肺炎危机给英国家庭及其财务状况带来了严重的财政困难。到2020年5月，14%的借款人拖欠抵押贷款还款。为了减轻经济损失，政府推出了史无前例的经济政策，提供收入支持和就业保护。贷款人试图通过引入暂停支付抵押贷款的抵押贷款假期来帮助陷入财务困境的借款人。到目前为止，已有1000多万工人被暂时解雇，近200万借款人享受了抵押贷款假期。该项目研究了冠状病毒工作保留计划和贷款人的抵押贷款假期是否减少了大流行期间抵押贷款违约的发生率。通过保障就业和补贴工人的月薪，休假计划可能允许财务困难的借款人继续支付每月抵押贷款。随着慷慨的支持逐渐减少，休假政策在防止抵押贷款违约方面的有效性可能会随着时间的推移而变化。抵押贷款假期可能会降低抵押贷款违约的发生率，因为它允许借款人推迟还款。然而，抵押贷款假期的有限期限(通常上限为3个月)可能会限制政策的有效性，只会推迟抵押贷款违约。这些支持计划的大规模推出在英国是史无前例的，尽管它们被广泛使用，并给政府和贷款人带来了巨大成本，但我们对其有效性知之甚少。这项研究有助于填补这一空白，并提供见解，帮助定制政策的设计，以最具成本效益地实现最大影响。为了制定答案，我们使用了来自理解社会数据库(U.S.)的数据。美元跟踪了英国家庭中近40,000人的生活，并提供了有关个人和家庭特征的信息，以及关于月收入、抵押贷款和利息支付、抵押贷款偿还问题以及一个人在疫情期间是否被暂时停职和/或享受抵押贷款假期的数据。使用使用和一个经济模型，我们估计了抵押贷款违约概率是如何受到一个人是否被暂时解雇和/或休了抵押贷款假期的影响。这使我们能够计算单个家庭的估计，然后可以用这些估计来预测政策在国家和地区层面的影响。这一点很重要，因为大流行的程度及其经济影响在该国不同地区有很大不同。我们还可以提供有关这些政策如何影响来自不同背景的借款人的见解。例如，根据他们的种族、年龄和收入。重要的是，我们可以定制该模型，以评估不同替代政策设计下的抵押贷款违约。因此，我们的工作使决策者能够评估未来不同政策的有效性，以最大化英国家庭的财务福祉，并确保金融资源得到有效配置。这一点很重要，因为疫情持续的时间越长，给政府财政带来的压力就越大。与此同时，大流行对不同地区和人口群体的影响程度也不同。因此，当务之急是制定政策，使公共资金得到合理使用，以维持最脆弱的家庭和地区的生存。

The Covid-19 crisis has inflicted serious financial hardship on UK households and their finances. By May 2020, 14% of borrowers were behind on their mortgage payments. To mitigate the economic damage, the government introduced unprecedented economic policies that provide income support and job protection. Lenders sought to help borrowers in financial distress by introducing mortgage holidays that suspended mortgage payments. To date, more than 10 million workers have been furloughed and almost 2 million borrowers have taken a mortgage holiday.This project studies whether the Coronavirus Job Retention Scheme (furlough) and lenders' Mortgage Holidays reduced the incidence of mortgage default during the pandemic. By safeguarding jobs and subsidising a worker's monthly wages, the furlough scheme may allow borrowers in tough financial circumstances to continue making monthly mortgage payments. The effectiveness of the furlough policy in preventing mortgage default may change over time as the generosity of support is tapered. Mortgage holidays may lower the incidence of mortgage default by allowing borrowers to defer payments until a later date. However, the limited duration of mortgage holidays (they are typically capped at three months) may constrain the policy's effectiveness and simply postpone mortgage default.The large-scale introduction of these support schemes is unprecedented in the UK, and despite their widespread use and the substantial costs to government and lenders, we understand little about their effectiveness. This research helps fill this gap and provides insights that help tailor the design of the policies to achieve maximum impact most cost effectively.To formulate answers, we use data from the Understanding Society Database (USD). The USD follows the lives of almost 40,000 individuals within UK households and provides information on individual and household characteristics as well as data on monthly income, mortgage and interest payments, mortgage repayment problems and whether a person has been furloughed and/or taken a mortgage holiday during the pandemic. Using the USE and an economic model, we estimate how the probability of mortgage default is influenced by whether a person was furloughed and/or took a mortgage holiday. This allows us to compute estimates for individual households that can then be used to make predictions about the policies' effects at the national and regional levels. This is important because the extent of the pandemic and its economic effects vary substantially across different parts of the country. We can also provide insights into how the policies affected borrowers from different backgrounds. For example, depending on their ethnicity, age and income. Importantly, we can tailor the model to assess mortgage default under different alternative policy designs. Our work therefore enables decision makers to assess the effectiveness of different future policies to maximise UK households' financial wellbeing and ensure financial resources are allocated effectively. This matters because the longer the pandemic persists, the greater strain it places on government finances. At the same time, the pandemic has affected different regions and demographic groups to different extents. It is therefore imperative that policies are designed so that public funds are spent well to keep the most vulnerable households and regions afloat.