Quantifying the Effects of Loan-to-Value Restrictions: Evidence from Turkey

Quantifying the Effects of Loan-to-Value Restrictions: Evidence from Turkey

Title:

Quantifying the Effects of Loan-to-Value Restrictions: Evidence from Turkey

Number:

15/35

Author(s):

Yavuz Arslan, Gazi Kabaş, Ahmet Ali Taşkın

Language:

English

Date:

December 2015

Abstract:

We examine the effect of loan-to-value restriction on automobile loans using primary market car sales in Turkey. We identify the effect of the policy using the specific nature of the regulation that imposes higher downpayment restriction for automobile loans with higher prices. We observe that the drop in automobile sales growth is higher for more expensive cars net of other controlled factors.

Keywords:

Macroprudential policy, Loan-to-value policy, Automobile loans, Car sales

JEL Codes:

G21; G28; E44

Quantifying the Effects of Loan-to-Value Restrictions: Evidence from Turkey
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