Why do lenders ask for collateral while lending ? -SST 10th

Why do lenders ask for collateral while lending ? -SST 10th
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Answer :

Lenders ask for collateral as security against loans. If the borrower fails to repay the loan, the lender has the right to sell the asset-or collateral to recover the payment.  Collateral assets (such as land, vehicle, etc.) act as a security for the lenders in case the borrower defaults on repayment of loan. It is for this reason that lenders ask for collateral while lending.
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What is collateral ? Why do lenders ask for collateral while lending ? Explain. -SST 10th

Description : What is collateral ? Why do lenders ask for collateral while lending ? Explain. -SST 10th

Last Answer : Collateral is an asset owned by the borrower like land, building etc, and is used as a guarantee to the lender till the loan is repaid. Lenders ask for collateral because: 1. It serves as a ... . 2. In case of failure of repayment of the loan, the lender can take the collateral as compensation.

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Description : Why do lenders ask for collateral while lending?

Last Answer : Feel Free to Answer

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Last Answer : (a) A money market instrument which helps in collateral short term borrowing and lending through sale and purchase operation in debt instrument 

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Why does the formal or informal sector ask for a collateral? -SST 10th

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Description : When borrowing from private lenders, how should one handle the cost of the underwriting?

Last Answer : One way or the other the borrower pays.

Should lenders be allowed to make loans they don't expect borrowers to be able to repay?

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Where do we get private lenders who will lend to real estate investors?

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Description : What Amount of money owed by a country to its lenders?

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Are Fannie Mae and Freddie Mac FHA lenders?

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Last Answer : No Fannie Mae and Freddie Mac are not FHA lenders. FHA loans are guaranteed loans and the others are not. FHA loans also have different guidelines and qualification tools.

Do You Have To Receive An Amortization Schedule From Lenders?

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Last Answer : An amortization schedule is a document that lays out how much money you are expected to pay each month on a loan. It will tell you how much interest you are paying, how much of your payment is going ... to rely on their lenders to be honest and upfront about the loan that they have just taken out.

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Who are the top commercial mortgage lenders?

Description : Who are the top commercial mortgage lenders?

Last Answer : Congratulations to your Aunt for purchasing her first business. Some of the better commercial mortgage lenders are State Farm Bank, Wells Fargo, and Visa.

Which commercial mortgage lenders charge the lowest mortgage points?

Description : Which commercial mortgage lenders charge the lowest mortgage points?

Last Answer : You will have to shop around in order to get the best rate on a mortgage. Different companies will offer you different rates based on several other factors.

Debt financing is a cheaper source of finance because of A. Time value of Money B. Rate of Interest C. Tax deductibility of Interest D. Dividends not payable to lenders.

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Last Answer : C. Tax deductibility of Interest

The importance of ‘Trading on Equity’ lies in the fact that if the company is earning more profit, it can make use of borrowed capital and preference share capital and by doing so, it can increase the income of: a. Preference Shareholders b. Lenders c. Equity Shareholders d. Government

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Which of the below-mentioned institutes are linked with the financial sector of India controlled by the Reserve Bank of India (RBI)? a) Commercial Bank b) Money Lenders c) Stock Exchange Operations d) All the above

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Explain the terms 'collateral' and 'terms of credit'. -SST 10th

Description : Explain the terms 'collateral' and 'terms of credit'. -SST 10th

Last Answer : Collateral is an asset that the borrower owns (such as land, building, vehicle, livestock, deposits with banks) and uses this as a guarantee to a lender until the loan is repaid. The terms ... one credit arrangement to another. They may vary depending on the nature of the lender and the borrower.

What is collateral ? -SST 10th

Description : What is collateral ? -SST 10th

Last Answer : Collateral is an asset which is a property of a borrower of loan such as - land, building, livestock, deposits with bank etc. The borrower uses this 'asset' as a guarantee to the lender (the one who gives money) until the loan is repaid by the borrower.

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Give some common examples of collateral used for borrowing. -SST 10th

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Why is it necessary for the banks and cooperative societies to increase their lending facilities in rural areas ? Explain. -SST 10th

Description : Why is it necessary for the banks and cooperative societies to increase their lending facilities in rural areas ? Explain. -SST 10th

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Why is it necessary for banks and cooperatives to increase their lending in rural areas ? -SST 10th

Description : Why is it necessary for banks and cooperatives to increase their lending in rural areas ? -SST 10th

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Do combantants really use the tactic of having women and children stand behind them to create collateral damage?

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Last Answer : answer:

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Last Answer : Only banks who offer business loans can answer this or try getting a small business loan through the government. I do not believe they require collateral.

Can your husband use your jointly owned property as collateral?

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Last Answer : What is the answer ?

Lateral collateral ligament (LCL) injury?

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Medial collateral ligament (MCL) injury of the knee?

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If I default on my personal loan agreement, can they repossess my collateral?

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Do you do start business loans. I have no collateral and I do not have money invested. Its just me and the idea for the store.?

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Last Answer : No you can only get a business loan with something down.

Can I use my car's title as collateral for a car equity loan?

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Last Answer : When it comes to using collateral for a car equity loan using your car title is an option through certain loan providers it just depends on their qualifications and the value of your car.

According to this lesson, what term is the way for commanders to adhere to LoW by weighing risk of collateral damage against military necessity and proportionality within the framework of the military decision-making process?

Description : According to this lesson, what term is the way for commanders to adhere to LoW by weighing risk of collateral damage against military necessity and proportionality within the framework of the military decision-making process?

Last Answer : Collateral Damage Estimation Methodology (CDM)

The product of the Collateral Damage Estimation Methodology (CDM) is known as the?

Description : The product of the Collateral Damage Estimation Methodology (CDM) is known as the?

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If xylem and phloem are arranged in the same radius, such a vascular bundle is called : (1) collateral (2) bicollateral (3) concentric (4) radial

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Description : A loan which is secured by collateral and for which borrower is not personally liable is called __________ A. Secured loan B. Syndicated loan C. Non-Recourse loan D. No Documentation loan

Last Answer : C. Non-Recourse loan Explanation: A non-recourse debt is a type of loan that is secured by collateral, which is usually property. If the borrower defaults, the issuer can seize the collateral ... any further compensation, even if the collateral does not cover the full value of the defaulted amount.

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Description : A combination of any two or more network topologies are known as: a) Bi-Lateral b) Hybrid c) Collateral d) None of These

Last Answer : b) Hybrid

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Description : 5. An IOU of the Federal Reserve Bank of San Francisco to Bank of America is called: a. discounts b. federal funds c. reserves d. collateral

Last Answer : c. reserves