Consumer Automobile Loans This research concerns the extensio

THE EXTENSION OF CONSUMER AUTOMOBILE LOANS BY CREDIT UNIONS

Specifically addressed in this discussion are (1) the evaluative structure for risk, (2) the evaluative structure for returns, and (3) the incorporation of risk and return factors into the decisionmaking process. The primary risk factor considered by credit unions in the extension of consumer automobile loans is the credit worthiness of the loan applicant (Dublin, 1989). The past credit history of the applicant, the current structure of the applicant's financial obligations, the change to this structure which would be caused by approval of the requested consumer automobile loan, and the relationship of the revised applicant credit structure to applicant income are the principal factor considered in the evaluation of applicant credit worthiness. With respect to the collateral (automobile), most credit unions require between 10 percent and 25 percent down from the applicant, depending upon the evaluation of applicant credit worthiness, and the age of the collateral. Dec

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of the TSP model is its consideration of the concept of utility. Utility is a "measurement of money based on the decision maker's opinion of monetary value under conditions of uncertainty" (Shao, 1990, 334). Under conditions of uncertainty (which almost always prevail in realworld conditions), the specific conditions under which events may occur, and the outcomes of the events themselves may not be predicted with certainty. In all instances, costs are associated with conditions of uncertainty. The variations in conditions which may exist and the variations in potential outcomes are referred to as states of nature. In the TSP Model, the probabilities of occurrence associated with each of the states involved in the decision problem must be determined, and must be incorporated into the decision analysis leading to project alternative selection. The model also provides for a consideration and an incorporation into the decisionmaking process the preferences of the decisionmakers. Preferences of decisionmakers, particularly with respect to outcomes, is a highly significant element in the selection of project alternatives. States of nature (conditions and outcomes), as well a
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Some common words found in the essay are:
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Approximate Word count = 3846
Approximate Pages = 15 (250 words per page)