Land, house and gold are commonly used as collateral for a bank loan. You can also use certificate of deposit and bonds as collateral for a loan. Apart from collateral you also need solid income source to get a loan.
What is the major challenge with getting loan for business
- Thread starter Josemendez
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My auntie got some loans from Bank and I think she defaulted by this month and before I know it our houses and cars were seized by the banks thereby plunging into poverty. So I will only say that taking loans from Bank is not really advisable.
I think the major challenge is the issue of trust to repay back the loan which
Lead to the tender of collateral to secure such loan. Most financial institutions will require a collateral to be able to give out loan so if the borrower default the collateral will be use to settle the debt.
Lead to the tender of collateral to secure such loan. Most financial institutions will require a collateral to be able to give out loan so if the borrower default the collateral will be use to settle the debt.
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I would say that the major challenge for funding a business with a loan Is paying back the loan, raising the funds required to settle the indebtedness especially if the business is not yielding expected results.
That's exactly the first major challenges in getting a loan for business because they need a proof that you have what it talks to pay back, that's why they always ask for surety and properties .
That's really sad to hear, but you're right. If you don't give back their money, they start getting from you what you have.
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The major challenge is what you have pointed out. When you used your collateral to stand for a loan, you will want to do everything to pay back the loan and get back the property used as collateral which pout a lot of pressure on you.
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Bank borrowers should be aware that the collateral has a turning point which is the forfeiture when the borrower cannot pay back the loan on the agreed time. Delayed installment payments are subject to penalties which means the amount of loan is growing. It is best to pay on time or even earlier so that penalties can be avoided.
This is actually what they call collateral in my country in fact if you don't have a collateral there is no way that you can take a loan from any bank in my country.
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I understand, but the rules in your country aren't different much like here, all of them have the same peculiarities.
But you will agree with me that it is much easier for you to obtain a bank loan than it is for me to obtain a bank loan in my country as most banks are so hesitate to give out loans in my country.
sure, however, I will never think to get a bank loan in the future, whether in my country or yours or other country xD
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The thing is that there are some situation whereby getting a bank loan becomes essential and I can categorically tell you that most rich men in the society actually take loans to start up their business.
That's what I was saying. At initial stage, it might not be necessary to take loan, but as the time progress and we get more growth, it become necessary to take it.
The reason most people are not able to get a loan for business is that they do not have something to keep as a collateral for getting a loan, because a business bank will not be able to give out loans without you having anything tangible to keep as collateral.
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It is at the initial stage that most people struggles to finance their businesses which is why it is very difficult for them to get a loan to finance it because nobody will trust the performance of a newly established business.
The two issues I've had with loans has been collateral and interest. Some lenders are callous enough to slap interests to the tune of 30% on short term loans. Unfortunately, these loan sharks are allowed to run free and wreck havoc and several small and medium businesses. I think government really needs to tackle these loan sharks.
In this case it is the best thing for you to work and raise the required money that is needed to start up the business you are interested in doing .it is not the best for you to rely on loan when you do not have collateral
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One of the major challenges I want to think that most people are having when it comes to securing loan facilities from the bank or any of the financial houses is the issue of collateral. People don't have the required collateral to present
The major issue in getting loan for business still remains collateral. A lot of Business owners can't tender collateral and this is because they don't have it and loan company usually need this to give out loan
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