A New Approach to Mortgage Design

Huffington Post, Jan. 11, 2018–Jack Guttentag
One intriguing approach has been suggested by Wayne Passmore and Alexander H. von Haften, economists at the Federal Reserve Board. Their central idea for encouraging more rapid equity growth is to trade off the borrower’s right to refinance when interest rates fall, which imposes a heavy cost on lenders, for larger principal payments.