<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>Green This article is aimed at investigating the determinants of mortgage loan approval in developing countries, employing the binary probit model. Loan approval was made the response variable while deposit, amount to borrow, lending rate, gratuity, capacity to pay the loan and character of the borrowers stood as the explanatory variables. Cross-sectional data were collected from the four top banks in Nigeria. The result showed that all the variables had the correct signs but only the capacity to pay the loan has a significant impact in determining the success of mortgage loan approval. Collectively, all the variables have significant power to determine mortgage loan approval. It is therefore suggested that prospective borrowers should ensure that they have all it takes to refund the loan they wish to obtain from commercial banks.</p>
</abstract>

Green This article is aimed at investigating the determinants of mortgage loan approval in developing countries, employing the binary probit model. Loan approval was made the response variable while deposit, amount to borrow, lending rate, gratuity, capacity to pay the loan and character of the borrowers stood as the explanatory variables. Cross-sectional data were collected from the four top banks in Nigeria. The result showed that all the variables had the correct signs but only the capacity to pay the loan has a significant impact in determining the success of mortgage loan approval. Collectively, all the variables have significant power to determine mortgage loan approval. It is therefore suggested that prospective borrowers should ensure that they have all it takes to refund the loan they wish to obtain from commercial banks.

Determinants of Mortgage Loan Approval in Banks in a Developing Country: Evidence From Nigeria

Studia Universitatis „Vasile Goldis” Arad – Economics Series

This work is licensed under the Creative Commons Attribution 4.0 International License.

Green This article is aimed at investigating the determinants of mortgage loan approval in developing countries, employing the binary probit model. Loan...

Determinants of Mortgage Loan Approval in Banks in a Developing Country: Evidence From Nigeria

Published Online: Jan 26, 2024

Page range: 56 - 73

Received: Feb 01, 2023

Accepted: Jun 01, 2023

DOI: https://doi.org/10.2478/sues-2024-0003

Keywords
Bank loan, Loan approval, Logit model, Probit model

© 2024 Abdurrauf Babalola et al., published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Determinants of Mortgage Loan Approval in Banks in a Developing Country: Evidence From Nigeria

Published Online: Jan 26, 2024

Page range: 56 - 73

Received: Feb 01, 2023

Accepted: Jun 01, 2023

DOI: https://doi.org/10.2478/sues-2024-0003

KeywordsBank loan, Loan approval, Logit model, Probit model

© 2024 Abdurrauf Babalola et al., published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Keywords
Bank loan, Loan approval, Logit model, Probit model