Question

Why do lenders ask for 'collateral' while lending? Analyse the reasons.( Only Three points)

Answer 1

FOLLOW THE ARROW YOU WILL SEE THE ANSWER:----

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REASON WITH YOUR DEMANDED 3 POINT'S:---

Lenders ask for collateral because :

(i) It acts as a proof that a loan has been taken from the lender.

(ii) It secures the lender in case the borrower do not return the money with interest.

(iii) The collateral helps the lender in getting back his money with interest.

Answer 2

HELLO ✧・ﾟ:*

Question :- Why do lenders ask for 'collateral' while lending? Analyse the reasons.

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Answer

Lenders ask for collateral because :

• It serves as a security against the loan borrowed.

• It secures the lender in case the borrower do not return the money with interest.  

• The collateral helps the lender in getting back his money with interest.

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Hope it helps you