Explain any four terms of credit

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Explain any four terms of credit

Posted by Aayush Pandey 7 years, 3 months ago

CBSE > Class 10 > Social Science

1 answers

Sonali Aggarwal 7 years, 3 months ago

The four terms of credit are :

a. Interest rate: Interest rate is the amount paid in addition to the principal by the borrower to the lender

b. Collateral: Collateral is an asset that the borroower owns( such as land, building, vehicle, livestocks, deposits with banks) and uses this as a guarantee to a lender untill the loan is repaid.

c. Documentation requirement: It is the process under which the lender verifies the eligibility and all the details of the borrower and also verifies the collateral related documents.

d. Mode of payment: Under this, the number of installments and gap between the two installments is agreed and also whether the loan is repaid whether in the form of cash, checque or any other mode.

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Posted by Shristi Pandey 1 month, 2 weeks ago

CBSE > Class 10 > Social Science