Adjustable rate mortgages and the mortgage crisis
Purpose – The purpose of this paper is to closely examine adjustable rate mortgages (ARM) made in Northwest Louisiana in order to provide a greater understanding of the causes of the high rate of defaults and potential foreclosures currently being experienced in Louisiana.Design/methodology/approach – The paper examines detailed information for all ARM recorded in a three‐month‐period.Findings – The paper finds that at least half of the loans have highly unfavorable terms with about a third having initial rates that are at least 3 percent higher than prime mortgage rates; these initial rates are likely to increase dramatically during future adjustment periods. Many borrowers also face high interest penalties if they pay back their loans before the first adjustment period. Also notable is the fact that only 7 percent result in foreclosure. While many borrowers receive unfavorable loans, relatively few loans are held for more than six years; a probable explanation is that the borrowers realize they have agr...
Real estate infrastructure financing in Ghana: Sources and constraints
Abstract Finance represents a major barrier to real estate development in Ghana and constraints responsible remain unknown. In order to gain insight into this important social/economic issue, a positivist tradition of thinking via the survey approach sought to uncover, explain and rank these constraints using the Relative Importance Index. A total of 53 questionnaires were distributed to real estate developers within the Kumasi Metropolis of Ghana. The survey reveals that real estate developers predominantly use debt financing including short-term bank loans, mortgages and hire purchase. Finance is constrained by five main factors: i) legislation; ii) macroeconomic barriers; iii) collateral barriers; iv) inadequate risk assessment and diversification mechanisms; and v) a dearth of financial mobilization mechanisms. This paper provides a practical reference for the targeting of policy interventions to overcome these constraints and to catalyse the development of finance for real estate infrastructure delivery. The work is also useful to the Government, banks and capital market regulators who seek to develop the capital market to provide appropriate financing options. These options may include real estate investment trusts (REITs) and risk reduction/diversification platform via derivatives. Future research is proposed which seeks to explore practical innovations in designing tailor-made real estate financing options that meet the needs of real estate developers.
The uprising of the marginalised: a socio-economic perspective of the Syrian uprising
More than three years after the outbreak of protests in a number of Arab countries, the role of socio-economic factors in these events is attracting more attention. One of the cases that needs more research is Syria. More than three years into the Syrian uprising, the socio-economic roots of the protest movement that became one of the bloodiest civil conflicts in the history of the Middle East need to be examined. While it has been observed that the Syrian uprising, contrary to some ‘Arab Spring’ countries, has been an uprising of more marginalised social groups with a strong role played by poorer segments in the society, particularly rural and rural-to-urban migrants, the socio-economic explanation for this is still underdeveloped. This paper aims at contributing to a better understanding of this issue by examining the political and socio-economic compromise that underlined the rule of the Ba’th party in Syria for four decades and unpacking how a combination of internal and external shifts that started in the 1990s and intensified in the 2000s led to the erosion of this compromise, providing the background to the events that began in 2011.