ATTENTION⚠️!
why do banks ask for Collateral while giving loans?
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Collateral is a guarantee to the bank so that if the borrower fails to repay the loan, the bank can sell the collateral and obtain the amount. Explanation: Collateral is a reassurance to the banks because, without collateral, the bank has no way to get back the money in case of failure of repayment.
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Answer:
- because we need loans to doing some a large work that is benefited for banks to give up loans and benefited for us also but there is an drawback for us and benefited for banks that is
- benefit is that banks takes interest or money both
- and we gave instrest this is draw back for us
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