ECONOMICS
CREDIT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A loan not backed by a co-signer who agrees to cover the amount of the loan.
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A personal loan without assets to cover the loan amount.
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A home equity loan.
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A loan taken on a life insurance policy.
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Detailed explanation-1: -An unsecured loan is that type of borrowing for which the borrower does not need to give a personal asset in exchange for the money he/she receives. Usually, the item given to the lending institution is called a collateral and this can be your house, your car, or your ornaments.
Detailed explanation-2: -What is meant by an uncollateralized loan? a. A loan not backed by a co-signer who agrees to cover the amount of the loan.
Detailed explanation-3: -If you do not repay your loan, the lender can take you to court. The court will then require that you pay back the amount in full or face other penalties such as wage garnishment or seizure of assets. The lender may also report the debt to credit bureaus and send debt collectors after you if payments become overdue.
Detailed explanation-4: -Most personal loans require no collateral, including a personal loan by Bajaj Finserv. In other words, they are unsecured loans that you can get without submitting any asset as security.
Detailed explanation-5: -Unsecured personal loans are loans that you can take out based on your creditworthiness and a promise to repay the loan. You don’t need to offer any collateral, and you might benefit from a low interest rate and predictable repayment terms.