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Most lenders do not require collateral for
short-term financing.; True or False
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- Collateral does not reduce the risk of a loan per se, becauseA. it is not part of the loan agreementB. the risk of a loan is determined by the borrower’s willingness and ability to repay the loanC. it may be worth less than the bank thinksD. the bank may not have title to the collateralWhat are spontaneous sources of short-term financing and unsecured sources of short-term loansWhich of the following is true of an unsecured loan?A. They are exclusively for cars, houses, and other large purchasesB. Collateral could be collected by the lender if the debt is not paidC. They never have any interest added onto themD. Items of value that the borrowers owns are not at risk of repossession
- The borrowing base used to guarantee collateral on an operating line of credit is highly dependent on the valuation rates allowed on short-term assets by the lender. A. True B. FalseThere is a formula that will find the APR, i, of a single payment loan but not for a series of payments loan. False or TrueAssuming the borrower is in no danger of default, under what conditions might a lender be willing to accept a lesser amount from a borrower than the outstanding balance of a loan and still consider the loan paid in full?
- Please answer the following questions what are two types of credit what is a security interest who is the debtor and creditor what happens if the debtor defaults what type of transaction requires a financing statementCredit card debt and commercial loans are easily among the most significant and familiar financial obligations that involve interest. True or false?URGENT How does high interest rate and setting ceiling on loans (limited credit) compensate for the possibility of defaulting?
- what are two types of credit what is a security interest who is the debtor and creditor what happens if the debtor defaults what type of transaction requires a financing statementAmortized loans with equal principal repayments will result in less interest being paid over the life of a loan than alternative types of amortized loans. True or FalseWhich of the following does not relate to credit risks? a. Credit risk is the possibility of losing a lender takes on due to the possibility of a borrower not paying back a loan b. It refers to the risk that a lender may not receive the owed principal and interest c. Credit risk also describes the risk that an insurance company will be able to pay a claim. d. Credit risk is the possibility of a loss resulting from a borrower's failure to repay a loan or meet contractual obligations e. Credit risk describes the risk that a bond issuer may fail to make payment when requested
