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Full-Text Articles in Law
"Ineffective In Any Form: Confirmation Biases And Other Psychological Phenomena Undermine Improved Home Loan Disclosures", Debra P. Stark, Jessica M. Choplin
"Ineffective In Any Form: Confirmation Biases And Other Psychological Phenomena Undermine Improved Home Loan Disclosures", Debra P. Stark, Jessica M. Choplin
Debra Pogrund Stark
This article reports three eye-tracking experiments funded by the National Science Foundation that investigated the limitations of home-loan disclosure forms as a means of protecting consumers from imprudent or otherwise unsuitable home loans. These experiments found that presenting misleading information (such as “your interest rate is at 4%” when in fact that interest rate can rise to 8% over the life of the loan) can cause consumers to exhibit confirmation biases wherein they inappropriately skim the form to confirm the misleading information (a rate of 4%), and ignore information that would disconfirm those beliefs (that the rate can rise). These …
Dysfunctional Contracts And The Laws And Practices That Enable Them: An Empirical Analysis, Debra P. Stark, Jessica M. Choplin
Dysfunctional Contracts And The Laws And Practices That Enable Them: An Empirical Analysis, Debra P. Stark, Jessica M. Choplin
Debra Pogrund Stark
The main function of entering into a contract is for both parties to be bound through being exposed to negative consequences if they breach. A review of purchase agreement forms used by condominium developers in Chicago, Illinois discovered that 79% eliminate the negative consequences for sellers by providing for highly one-sided remedies wherein the buyer’s sole remedy in the event of the seller’s breach was the return of the buyer’s own earnest money while reserving significant remedies to the developer in the event of the buyer’s default. Courts in many jurisdictions have refused to strike down this type of limitation …
"Should I Stay Or Should I Go: Promoting The Sustainability And Suitability Of Reverse Mortgages", Debra P. Stark, Jessica M. Choplin
"Should I Stay Or Should I Go: Promoting The Sustainability And Suitability Of Reverse Mortgages", Debra P. Stark, Jessica M. Choplin
Debra Pogrund Stark
No abstract provided.
“A Psychological Investigation Of Consumer Vulnerability To Fraud: Legal And Policy Implications”, Debra P. Stark, Jessica M. Choplin
“A Psychological Investigation Of Consumer Vulnerability To Fraud: Legal And Policy Implications”, Debra P. Stark, Jessica M. Choplin
Debra Pogrund Stark
This article focuses on a type of consumer fraud that is particularly problematic because it may not be actionable in some jurisdictions, namely the problem of consumer vulnerability to deception when a consumer notices a problematic term in a contract but is persuaded through deception to proceed with the deal anyhow. Two fraud simulation studies and a follow-up survey demonstrated how this type of fraud operates, found that consumers with certain vulnerability characteristics such as having lower socio-economic status are more susceptible to this type of fraud, and explored some of the psychological reasons why consumers are vulnerable to it …
Consumer Protection Initiatives In The Eu Mortgage Market: A Behavioral Economics Based Critique And Proposal, Debra P. Stark, Jessica M. Choplin
Consumer Protection Initiatives In The Eu Mortgage Market: A Behavioral Economics Based Critique And Proposal, Debra P. Stark, Jessica M. Choplin
Debra Pogrund Stark
This article critiques the Commission of the European Union's recent consumer protection initiatives for the EU mortgage market focusing on the revised form of disclosures that the Commission appears poised to mandate in a Directive, providing suggested reforms to this form to make it more effective and proposing four additional consumer protections to empower EU consumers to make wise home loan decisions. The article argues that these additional consumer protections are a necessary condtion to creating the integrated EU mortgage market (with more cross border home loans) that the Commission desires.