ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Installment loans can be either collateralized or non-collateralized. Collateralized loans require borrowers to pledge an asset against the amount of loan borrowed. For auto loans, the motor vehicle being purchased using the loan amount is used as the collateral for the loan until the loan is fully paid.

Detailed explanation-2: -Installment loans are personal or commercial loans that borrowers must repay with regularly scheduled payments or installments. For each installment payment, the borrower repays a portion of the principal borrowed and also pays interest on the loan.

Detailed explanation-3: -With secured loans, your property is used as collateral. If you cannot repay the loan, the lender may take your collateral to get its money back. Common secured loans are mortgages, home equity loans, and installment loans.

Detailed explanation-4: -Secured loans are debt products that are protected by collateral. This means that when you apply for a secured loan, the lender will want to know which of your assets you plan to use to back the loan. The lender will then place a lien on that asset until the loan is repaid in full.

Detailed explanation-5: -Installment loans-also known as installment credit-are closed-ended credit accounts that you pay back over a set period of time. They may or may not include interest. Read on to learn more about different types of installment loans and how they work.