All kinds of the latest list plus an in depth dysfunction is demonstrated during the Desk step three, below

Another declaration ‘s the Commission’s Study on the expense and you will Benefits associated with the many Rules Solutions having Financial Borrowing from the bank (European Percentage, 2009, get a hold of particularly Annex B: Legal Summaries)

To test our main theory your to very early payment increase the pace spread involving the banks’ borrowing rate and you may lending cost during the an even more official styles, we very first constructed a consumer coverage directory. The directory categorizes countries depending on the types of settlement, if any, one users need to pay on their lenders whenever they intend to pay off its mortgages until the contractual deadline. All of our categorical index changeable ranges from the reasonable number of user coverage Is discussed = 0 with the high quantity of individual shelter Totally free = 2.

Here we expected the newest central finance companies, ministries from funds of one’s Member States and you will lender or individual protection connections in regards to the relevant level of consumer security in their particular places

The index classifies the brand new statutes ruling very early repayment in all European union Representative Says between 2006 and you will 2016 to your 30 days-to-month base. Locate details about just what laws and regulations ruled very early money at which time inside certain country, we mark out-of numerous supplies. A study conducted by European Percentage included in their work so you can harmonize the brand new Eu financial avenues, gathered detailed information on the federal mortgage , pick especially profiles 5581). Using this study we have removed information on the fresh new court regimes governing early payments from the Eu Affiliate States inside 2006. This research obtained research on amounts of individual defense having untimely money in ’09. But not, both accounts have mainly qualitative details about the national shelter accounts. I thus developed our personal class plan so you’re able to quantify these types of research and you can accompanied a two fold-blind coding processes. Ultimately, in 2016 i used an e-post survey to gather our own number 1 study. The consumer safeguards directory that lead from our category exercise is presented when you look at the Desk 4, below.

Based on all of our Consumer Protection Index we created one or two in different ways coded explanatory details. Such details were used in the statistical habits to check the hypothesis more stringent individual security laws and regulations results in high interest price develops amongst the banks’ borrowing from the bank rates and you may financing costs. All of our first, fundamental changeable is the User Safety to have Very early Repayment (Dummy) adjustable. Since conveyed by the its identity, that it variable is actually a beneficial dummy you to rules the initial group of our list Payment towards the bank should be negotiated or injuries need to be paid because 0 and all of most other classes, we.elizabeth. Responsibility cover or lender’s a lot more management costs merely and you may Totally free once the 1. The explanation trailing which coding is that the site class is short for those individuals places and this incorporate brand new standard laws found in package rules to own a violation of a customers financial bad credit loan Lone Tree CO offer. The newest adjustable requirements as step one every nations one to diverge out of this default rule and you may instead suggest a high mandatory safeguards height for user financial deals. So it dummy was ergo a conservative and reliable way of measuring the fresh user protection membership for very early money on different User States. I use the dummy adjustable inside our fundamental statistical designs, while we think it over become the most likely measure to shot the lookup theory.

Our next variable ‘s the User Defense having Very early Installment (Categorical) variable. That it categorical adjustable provides the same programming since the individual safety directory brought above. In comparison to the dummy adjustable, it will be the much more finely grained and you will complex level. Regarding an appropriate point of view, this new adjustable is generally shorter legitimate, if we believe that multilinguistic, multijurisdictional ecosystem of European union made the fresh relative laws effort about what the new programming would depend a difficult activity. In addition, the newest quantities of findings for each group is smaller well-balanced compared to the new dummy changeable. I hence utilize this adjustable to own an over-all robustness attempt. In any case, the outcome we acquired having one another parameters try consistent with one another.