La indexación de los saldos hipotecarios y la crisis colombiana de final del siglo xx

the goal of this article is to evaluate the impact on mortgage default of the policy regulating the indexation of mortgage balances in colombia during the 1990's. i argue that this policy, introduced by the colombian economic authorities during the early 1990's, had a substantial effect on mortgage default during the economic and financial crisis experienced by the colombian economy during the late 1990's. i perform an econometric analysis based on an optimal default model that is mapped to a random sample of mortgages that were outstanding between 1997 and 2004. the results imply that default was mostly determined by the variation in mortgage balances and home prices, and not much by the variation in income. moreover, i estimate that approximately 50% of observed default among mortgages initiated after 1996 is the result of the policy of tying the mortgage balances to the interest rate.