Therefore, loans with collateral are those that the borrower or person obliged to repay the loan gives to the lender (or person who grants us the financing) so that in case of default, it deals with the payment of the requested loan.
In this article we tell you what the loans with collateral consist of, how many types of collateral exist? What documentation do I need in the loans with collateral? Can crowdlending platforms request collateral? … We answer all this and much More on loans with collateral. We add a summary infographic.
The guarantee: the protagonist of the loans with guarantee
An endorsement, therefore, is a personal guarantee, not a real one. That is, in these loans, there is a person guarantor of the debt, which is obliged to return the debt in case of default of the first obligor. When you endorse a property, for example, we would be talking about a real guarantee, not an endorsement.
A guarantor can be one of several loan applicants, so the guarantor’s capacity will depend on his economic and financial capacity.
The guarantee can be established for a definite or indefinite time. It may be the case of being a guarantor until a certain date or until a certain amount has been amortized.
The conditions that a guarantor has to meet are, in general, the following:
One of the most influential factors to be able to consider a person as guarantor, is that he has an income that exceeds his obligations, being always favorable that he does not have any type of debt.
Have load-free properties
It is obvious that if the guarantor is a guarantee for the bank, it must have the lowest possible burdens, so that if the first debtor does not really face his debt, the financial entity may go to collect the debt from the bank without any danger. for this.
It is important that in addition to the guarantor having no debts, he can be a beneficiary of stable income. So they would have the advantage to become guarantors of a loan for collateral, for example pensioners, officials, etc., who receive income in a stable manner.
This is something very typical of banks. If the guarantor has no relationship with the bank, it is very likely to be rejected as guarantor, which does not happen on platforms such as Mr. Merdle, where it is not taken into account.
Loans with collateral: what types of collateral exist?
As we have already said, a guarantee is a guarantee of payment by the person to whom the loan is granted with a guarantee. Doubts now arise about what types of guarantees may exist, since it will depend primarily on the purpose pursued. In this case, by focusing on the loans with collateral, we will attend to two types of collateral: economic guarantee (the one that guarantees commitments related to deliveries agreed a priori of money and goods), and personal guarantee (the one designated by a natural or legal person to commit to the payment of the debt in case of default of the main debtor). Within these we find the following types of guarantees:
It is a personal guarantee of the borrower himself (person requesting the loan with guarantee) that, as agreed, all loan installments will be paid. In case of default, the debt would be collected directly from the payroll. However, these types of guarantees are not usually accepted by banks or by financial alternatives such as Crowdlending since if you need to request a guarantee it is because it has been previously verified that the economic and financial situation of the loan applicant is not adequate for your concession.
Guarantee by which a third party will take charge of the debt in case of breach of the holder. These types of guarantees are usually the most common in practice since the verification of certain solvency by the guarantor is sufficient for the granting of the loan with collateral.
Guarantee in real rights
In this case, the guarantee given to the lender is a movable or immovable property (for example, a flat). So that, in case of breach of the agreement, the lender can collect the debt owed through the “pledge”. Thus, until the debtor does not face the entire loan with guarantee, the actual possession of the established guarantee is not recovered.
What documentation do I need in loans with collateral?
Let’s say that the financing applicant is a company. The financing requesting company will have to present a certain documentation in order to study the operation.
If once assessed, the need for personal guarantees is considered, the company must provide documentation that makes known the situation of the guarantor to the entity, documents that show that the guarantor can actually face the debt in case of default by the main holder Thus, you must present, among others, the safeguards of your bank accounts (which collect the amount to which your savings amount), payrolls or documents that show that you are a beneficiary of stable income, as well as those that show that you have no debts.