why do lenders ask for collateral while lending .
Answers
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.) ... It is for this reason that lenders ask for collateral while lending.
Explanation:
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Explanation:
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.) ... It is for this reason that lenders ask for collateral while lending.
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: It serves as a security against the loan borrowed.