Question

explain the importance of colateral (1m)​

Answer 1

Answer:

Generally, secured loans offer better terms and clauses than unsecured loans. With secured loans, borrowers can get lower interest rates and longer loan periods, as they can provide collateral, which makes the loan a more secure investment for the lender.

Answer 2

Answer:

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Explanation:

The collateral acts as a form of protection for the lender. That is, if the borrower defaults on their loan payments, the lender can seize the collateral and sell it to recoup some or all of its losses.