The matter of reciprocal loans, whereby a loan is tied to an equivalent (reciprocal) loan in terms of amount and period, raises many questions particularly from the shariah point of view. This necessiates looking into the existing contracts, whether by individuals or corporations, pertaing...

The reciprocal loan simply means that in return for a loan for a specific period, the lender receives an equivalent amount of loan for a similar period of time. Some contemporary scholars believe that reciprocal loans are legitimate, if they are not tied, that is if the lending of one loan does...

This paper presents a reduced-form barrier model for the optimal principal reset in a loan modification, thereby maximizing the loan value to the lender bank and minimizing the likelihood of foreclosure by the homeowner. Reducing the loan-to-value (LTV) ratio will reduce the present value of...