Can Mortgage Delinquencies Lead to Unemployment? - FOXBusiness.com It seems fairly obvious that unemployment would cause – or at least lead to mortgage delinquencies. But what about the reverse? Do delinquencies cause unemployment? We might see that in a narrow sense, but according to University of Chicago Economics Professor Casey Mulligan, there is a clear link. In a new paper published by the National Bureau of Economic Research, Mulligan argues the actions of lenders offer homeowners strong incentives to become unemployed, or at least minimize what they earn.