Loan Commitment Contracts, Terms of Lending, and Credit Allocation

  • Author(s): ARIE MELNIK, STEVEN PLAUT
  • Published: Apr 30, 2012
  • Pages: 425-435
  • DOI: 10.1111/j.1540-6261.1986.tb05046.x

ABSTRACT

This paper analyzes the structure of loan commitment contracts and the interrelationships among their component parameters. Lenders offer borrowers a set of loan “packages,” from which the latter may choose that “package” found to be most appealing. Borrowers may “trade off” changes in any loan parameter in exchange for other adjustments. The borrower, at this time, may “purchase” a larger credit ration for a price. Supporting empirical evidence is presented.

Jump to menu

Main Navigation

Search the Site / Journal

Search Keywords

Search Tips

Members' Login

Credentials

Members' Options

Site Footer

View Mobile Version