BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -A lien provides the creditor with the legal rights to seize and sell the collateral assets or property which is the subject of the lien without the consent of the lien holder or the borrower. When the lien is granted on an inventory or any other unfixed property, it is known as a floating lien.

Detailed explanation-2: -Collateral gets affected While this is the last resort, banks can rightfully take possession of the collateral and auction it to recover the loan amount if you fail to repay the loan.

Detailed explanation-3: -Collateral is an asset that the borrower owns (such as land, building, vehicle, livestocks, deposits with banks) and uses this as a guarantee to a lender until the loan is repaid. If the borrower fails to repay the loan, the lender has the right to sell the asset or collateral to obtain payment.

Detailed explanation-4: -If and when the borrower defaults on their payments, the lender is legally allowed to take over ownership of the mortgage against which the loan was processed, under the SARFAESI– Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

Detailed explanation-5: -Residential mortgage This is a type of loan where your house is used as secured collateral. If you default on the equated monthly installment (EMI) for a particular period, the lender can take legal action to repossess your property.