Product description for Bulgarian indexed capped credit

The mortgage product proposed in this paper is intended to function within this context while staying within the framework of a market economy. In designing the proposed mortgage -- referred to as the Bulgarian Indexed Capped Credit, or BICC -- the authors considered alternative mortgage instruments recommended previously for other countries experiencing similar economic situations. The authors also analyzed a variation of the Price Level Adjusted Mortgage (PLAM) proposed in earlier work for Bulgaria. The result is an alternative mortgage instrument that attempts to take advantage of the benefits of these other mortgages while addressing some of the problems associated with them. The first section of this paper defines the BICC. The second section briefly compares the BICC with other mortgage products. The third section discusses how the BICC addresses those issues critical to the success of a mortgage in Bulgaria: borrower affordability and lender risks (interest rate, liquidity, credit, and political). (Author abstract)