Speaker: Heejin Yoon (Wisconsin)

Paper Title: Barriers to Reentry: Initial Borrowing Frictions, Refinancing, and Wealth Redistribution

Date: Wednesday 15th/Apr/2026 at 9:00 AM Eastern Time

Abstract:  This paper examines how frictions encountered during the initial purchase mortgage origination process shape borrowers’ future refinancing behavior and contribute to wealth disparities. Leveraging variation in loan officer workload as a quasi-random source of lender-induced origination delays, I find that experiencing a 60+ day delay lowers quarterly refinancing rates by 16–24%. Minority borrowers, low-income households, and those with lower credit scores are more likely to encounter such frictions, with evidence pointing to lender bias as a potential driver of racial disparities. A simulation from a quantitative model of refinancing behavior implies a present value loss of $3,090 per delayed borrower, which amounts to roughly $1.3 billion in overpayments each year when scaled to the U.S. market. The structural framework further provides insights into distributional heterogeneity in delayinduced losses, a general equilibrium effect on mortgage pricing, and policy counterfactuals—such as a rate concession on the initial mortgage and a separating-equilibrium pricing that offers lower rates on future refinancing opportunities—that could substantially mitigate these costs.

Registration: https://us06web.zoom.us/webinar/register/WN_H4gPhia4SPq5issoa84CqQ#/registration