- 07/28/2019 at 8:05 pm #1545237EduGorillaKeymasterSelect Question Language :
Direction: In the following passage, there are blanks, each of which has been numbered. These numbers are printed below the passage and against each, five words are suggested, one of which fits the blank appropriately.
In lending agreements, collateral is a borrower’s (64) of specific property to a lender, to secure repayment of a loan. The collateral serves as a lender’s (65) against a borrower’s default and so can be used to (66) the loan if the borrower fails to pay the principal and interest (67) under the terms of the lending agreement. The protection that collateral provides generally allows lenders to offer a (68) interest rate on loans that have collateral compared to those without collateral because the risk of (69) to the lender is lower. The reduction in interest rate can be up to (70) percentage points, depending on the type and value of the collateral. If a borrower defaults on a loan (due to (71) or another event), that borrower loses the property pledged as collateral, with the lender then becoming the (72) of the property. In a typical (73) loan transaction, for instance, the real estate being acquired with the help of the loan serves as collateral.
Find out the appropriate word in each case.
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