The Shifting of FHA Discount Points: Actual Vs. Expectations |
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| Authors: | Stanley D Smith G Stacy Sirmans |
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| Institution: | School of Business Administration, Emory University, Atlanta, Georgia 30322.;Department of Finance, College of Commerce and Industry, Sirrine Hall, Clemson University, Clemson, South Carolina 29631. |
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| Abstract: | This study extends the earlier studies by Zerbst and Brueggeman (Z&B) and Colwell, Guntermann and Sirmans (CGS) with regard to the shifting of FHA discount points by the seller to the buyer in the form of a higher selling price. The study extends the earlier studies by reducing the estimation problems of the CGS model and further developing the Z&B model to incorporate expected discount points built into the asking price. The results presented indicate that 100% of the points are not being shifted. Reasons for the less-than-full shifting are given. |
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