This process, a dash of bad news in a strong market leading to losses for optimistic buyers and finished by the coup de grace of higher collateral requirements, is cathartic.
Direct the HUD Secretary to establish sound underwriting policies for mortgages insured by the FHA, including consideration of higher collateral requirements, a maximum seller concession, the use of a residual income test, a consumer disclosure regarding an affordable housing loan's historical propensity to default, and an increase in the capital ratio of the Mutual Mortgage Insurance Fund.
The Dodd-Frank law was supposed to bring much-needed oversight to the multitrillion-dollar market for derivatives, including transparent trading, mandatory reporting and higher capital and collateral requirements.
Some studies (Bigsten, 2003; Yitayal, 2004), with the main focus on the developing countries, observed that the lack of collateral requirements, high risks, information asymmetries, small credit transactions particularly of rural households, and the distance between lender-borrowers as the main causes for credit variation among the different and existent sources of credit.
Those entrepreneurs still must go through the traditional financing channels, with nearly prohibitive collateral requirements and high interest rates.
Over the next week or so, the exchange decided to raise collateral requirements even higher, in four more steps that would kick in every couple of days.
The constraints faced by SMEs are associated with the lack of clear financial plans, the accounting documentation, higher rate of interest, and the lack of collateral requirements (MIC, 2007).
About one-third of OTC trades require no margin or collateral requirements at all.
Mathew Dunn, a lobbyist for the National Marine Manufacturers Association, said collateral requirements for loans to recreational boat dealers are higher than those for securities backed by car loans.
We do not find any evidence that the lower loan cost of a high-quality-management firm is associated with more restrictive non-price contract terms such as greater collateral requirements and stricter covenants.
