Jul 26
A loan that is backed up by collateral to reduce the risk assumed by the creditor is referred to as secured loan. This loan may be secured by assets like houses, cars, stocks, bonds or other properties registered in the name of the loan borrower. For obvious reason, the valuation of the collateral must be relatively greater than the amount of loan taken out.
Before the loans are approved, the titles shall be delivered to and kept by the lender until full payment thereof. While the lender is in possession of the titles, the properties entail restrictions as to its use and disposal.
The common types of secured loan are nonrecourse and mortgage. Read more…
Tags: Secured Loans