Topic
Representative APR
About: Representative APR is a research topic. Over the lifetime, 82 publications have been published within this topic receiving 1244 citations.
Papers published on a yearly basis
Papers
Patent•
4 Jun 2003
TL;DR: In this article, a method for correcting and verifying consumer credit is proposed. But it is based on the assumption that the information at credit repositories is often incorrect and incorrect information at the credit repositories are contacted to correct and verify incorrect information.
Abstract: A method for correcting and verifying consumer credit. Credit scores receive from credit scoring services determine loan awards and interest rates. Information at credit repositories is often incorrect. Credit reporting agencies report credit scores to requesting users. A consumer verifying credit information inputs requested data and requests a credit score. The application and credit scores are transmitted via a communications network. The applicant verifies information through inputs, interacting with a system hosting the credit correcting software. Repositories are contacted to correct and verify incorrect information. The program also identifies and generates a list of incorrect information. Repositories are given this information and requested to verify and correct the incorrect information, resulting in a new score with corrected credit information, typically resulting in a better credit score. Better credit scores and correct information permits users to better evaluate the credit risks associated with decisions based upon credit scores.
146 citations
TL;DR: In this article, the authors presented a theory of interest rate determination on informal credit in backward agriculture when there is a market for formal credit and the farmer has to bribe the official of the formal credit agency in order to get formal credit.
Abstract: The paper presents a theory of interest rate determination on informal credit in backward agriculture when there is a market for formal credit. The farmer has to bribe the official of the formal credit agency in order to get formal credit. The official and the moneylender play a non-cooperative game in choosing the amount of formal credit and the informal interest rate, respectively. The informal-sector interest rate and the effective formal-sector interest rate (incorporating the bribe) are equal in equilibrium. A reduction in the formal interest rate and/or an increase in the price of the product may lead to an increase in the equilibrium bribing rate and the informal interest rate when the formal credit and the informal credit are complementary to each other.
89 citations
Posted Content•
TL;DR: In this article, the adverse selection hypothesis was tested and rejected, and it was shown that banks face an adverse selection problem: Lowering the annual percentage rate of interest (APR) would attract risky customers and increase delinquent loans at a significantly higher rate than loans in general.
Abstract: Sticky interest rates on credit card plans have long been a mystery. One possible explanation is that banks maintain high rates because consumers' demand for credit card loans is inelastic. This study tests and rejects that hypothesis. Demand for credit card loans is found to be elastic with respect to interest rates charged, and the amount of delinquent loans is found to increase significantly more than total credit card loans when interest rates drop.> The results show that banks face an adverse selection problem: Lowering the annual percentage rate of interest (APR) would attract risky customers and increase delinquent loans at a significantly higher rate than loans in general. This induces banks to maintain high interest rates. The adverse selection hypothesis is further supported by the finding that banks' income from credit card fees and interest increases with APR. Consumers' demand is also found to be responsive to some of the enhancements added to the terms of credit card plans. Banks may find it optimal to charge high interest rates, while adding enhancements in order to attract customers and raise their income at a low cost.
47 citations
TL;DR: The model presented in this paper departs from the traditional static models and examines dynamic operation for a United States credit union, clarifying a number of issues—such as optimal equity retention and inter-temporal rate policy—not addressed by earlier studies.
Abstract: A topic of recent interest in the retail financial sector has been the growth of credit unions or “pure cooperatives”. Past credit union researchers built mathematical models of credit union operations. These models identified important operating characteristics but were modeled under assumptions of static operating environments. The model presented in this paper departs from the traditional static models and examines dynamic operation for a United States credit union. Its inter-temporal structure clarifies a number of issues—such as optimal equity retention and inter-temporal rate policy—not addressed by earlier studies. Given initial conditions, the model specifies equity retention and inter-temporal deposit and loan rate policies until an equilibrium state is reached.
37 citations
1 Jan 2005
TL;DR: In this article, the authors present the history of credit products and providers, the economics of credit, marketing, and its marketing, credit reference agencies, Ethics in Lending Legislation and Consumer Rights.
Abstract: Preface Introduction The History of Credit Products and Providers The Economics of Credit and its Marketing Credit Granting Decisions Credit Reference Agencies Credit Management Ethics in Lending Legislation and Consumer Rights Appendix A: The Calculation of Interest and APR Appendix B: A Brief Note on the Construction of Credit Scorecards
36 citations
Related Topics (5)
Performance Metrics
| Year | Papers |
|---|---|
| 2017 | 5 |
| 2016 | 1 |
| 2015 | 7 |
| 2014 | 2 |
| 2013 | 2 |
| 2012 | 2 |