why do bank money lender demand Collaterala aganist loan
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Why Bank demand collacteral loans and advance? A Secured is a loan that has collateral a attached to it This type of loan generally has a lower interest rate because the bank is taking a lower risk because it can collect the collateral if you deafult on payment.
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COLLATERAL IS AN ASSET WHICH IS OWNED BY THE BORROWERS WHICH THE BANKS TAKE AS A GUARANTEE .IF THE BORROWERS FAIL TO REPAY THE LOAN THE LENDER HAS THE LEGAL PERMISSION TO SELL THE COLLATERAL TO OBTAIN PAYMENT
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