Factors Affecting Loan Payment - 1723 Words

Tropentag 2009 University of Hamburg, October 6-8, 2009 Conference on International Research on Food Security, Natural Resource Management and Rural Development ========================================== Factors Affecting on loan Repayment Performance of Farmers in Khorasan-Razavi Province of Iran Mohammad Reza Kohansal Assistant professor of agricultural economic dep., Ferdowsi University of Mashhad, Iran Hooman Mansoori Msc student of agricultural economic dep., Ferdowsi University of Mashhad, Iran Abstract This study investigated the factors influencing on repayment behavior of farmers that received loan from agricultural bank by using a logit model and a cross sectional data of 175 farmers of Khorasan-Razavi province in 2008.†¦show more content†¦These authors simulate probabilities of default and default costs on zero-down payment loans and then compare the results with conventional underwriting standards. They estimate that, if low-income borrowers are enticed by zero-down payment requirements and if no adjustment for the higher default rates is made, the cost of the implicit subsidy would amount from $74,000 to $87,000 per million dollars of lending. Quercia et al. (1 995) show that a lower loan-to-value (LTV) ratio at the time of origination (i.e., higher down payment) leads to lower default rates for rural, low-income borrowers. These authors focus on the 1981 Farmers Home Administration Section 502 program and show that, while contemporaneous equity value in rural low-income mortgage loans is not associated with default, crisis events are. Van Order et al. (2000) find, however, that the default behavior of both low- income and average-income groups is responsive to negative contemporaneous equity, while default rates and default losses are higher for low-income borrowers. Moreover, the influence on credit risk of individual and neighborhood income is small for LTV less than 80 percent, but it ranges from 15 up to 50 basis points for very high LTV ratios. Enticing low-income mortgage borrowers with lower down payment requirements thus Increases the risk of default. Oladeebo (2008) examined socio-economic factors influencing loan repayment among small scale farmers inShow MoreRelatedStudent Loan for Higher Education764 Words   |  3 Pagesdifficulty financing their children’s education. To resolve this problem, they need to find a lender who can help them to pay for their children’s tuition fees. We often hear about personal, home, or car loans, but for the purpose of this research, I will shift my focus towards education loans. An education loan is basically funding provided by an entity which typically the government, a bank, or an organization to help a student pursue their studies by covering things such as their tuition fees, cost ofRead MoreGovernment Housing Policy On Home Ownership Rates1133 Words   |  5 Pagesused to benefit homeowners and direct subsidies designed to alleviate the financial pressure of owning a home. Following, we examine the effectiveness of the primary government entities that provide benefits to homeowners. Fannie Mae, Federal Home Loan Bank, and Freddie Mac are three major government entities that provide benefits to homeowners. Using the results from the reports â€Å"Accounting for Changes in the Homeownership Rate† and â€Å"Mortgage Innovation, Mortgage Choice, and Housing Decisions†Read MoreRefinancing Your Student Loans972 Words   |  4 PagesRefinancing your student loans means that a private lender is essentially buying your Federal student loans, paying them off, and creating a new loan that it will lend to you on new, original terms. The new terms of your refinanced loan will be based off your credit reports, credit score, and other requirements. The new private loan terms include, among other things, a new interest rate and potentially a new term (the length of time over which you have to repay your loan). For example, you couldRead MoreResearch Paper On Capital Loaning897 Words   |  4 Pagesor improving your current one, a working capital loan can secure you the funding you’ll need to reach your goals. 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However, as our nation recovers from this crisis, we look ahead to new opportunities and safe loan standards for home ownership. â€Å"Like a boomerang,† a Sarasota Herald Tribune article describes â€Å"†¦recession-battered [boomerangRead MorePurchase A Used Car Loan Rates911 Words   |  4 Pagesincluding used car loan rates typically running several points higher than for new car loans. Add in a handful of used car financing mistakes and your so-called â€Å"deal† may quickly sour. Mistake No. 1 — Not Knowing Your Credit Score Make any credit-based purchase and lenders will obtain your credit score, a three-digit number that rates your creditworthiness. Consumer credit scores range from 300 to 850 with a higher credit score better for obtaining a low-interest rate loan. Higher rates are offeredRead MoreThe Problem Of Rising Student Loan Debt1495 Words   |  6 Pagesfour, a large number of the social problems described in the text can and does directly relate to myself, as well as, my family especially regarding the matter of education. However, the problem directly affecting my family and I is the emerging social problem of rising student loan debt. Student loan debt is a problem that has begun to seep into the very mainstream of society as more and more individuals attend college, especially those with great financial needs. Personally, I am lucky to say thatRead MoreStudent Loan Debt And Its Effect On Our Economy1431 Words   |  6 PagesPortfolio Project Throughout the years student loans has increasingly began to affect our economy and is a large and growing issue. Mounting student loan debt is ricocheting through the United States, now affecting institutions and economic patterns that have been at the core of America s very might (Holland 2015). General economic principles are affected by the constantly growing student loan debt in the economy. Macroeconomic indices are identified and defined with their roles in student debtRead MoreResearch Proposal1706 Words   |  7 PagesSYLVIA NYANDUKO OGEGA ECO/1003/09 †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ LECTURER: DR. OMONDI OPIYO DATE: 4TH NOVEMBER, 2010. Proposal for Research Study Factors affecting the success rate of microfinance in Economic students association funding project By GROUP SEVEN 4th November 2010 DECLARATION We hereby declare that this research proposal has not been submitted to any other institution for any academic qualificationRead MoreKey Factors Affecting The Foreclosure Crisis1286 Words   |  6 Pages The rise of the risk-free, no-down payment, low-documentation loan was not only born, but metastasized beyond imagination. Traditionally, the biggest hurdle to home ownership was the down payment. Ever since banks began lending, from the secondary market innovations of the depression era 1930’s and through the 1990’s, a down payment was always required. You could not buy a home unless you were willing to first put up some of your own money. Three factors changed this equation, and when combined