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What is Collateral when making Loan Request.

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Collateral is something pledged as Security for Repayment of a loan , which can be forfeited in case of Defaulting the loan or getting late for payment(It's upto Lender to wait for you to repay or sell it which also depends on Your collateral whether that stay good or goes banana.)

In general the amount lenders will be looking for is collateral equal to 110%-120% of the amount you are being loaned. Why is this? Well, first, they want to discourage you from running off with the funds. Collateral also needs to be something that can easily be sold, which brings me to my second point - your $500 worth of ink isn't going to cut it as collateral. Normally lenders will want things such as Altcoins or precious metals, although things that can be sent electronically are preferred.

A common question is why don't I just sell my collateral? Well the reasoning behind collateral is that you think it's impotrant to you and you don't want to sell it or you think it will rise in price.

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