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What does the value of collateral or down payment affect? Check all that apply.

the amount borrowed
the interest rate
the lender’s perceived risk
the repayment schedule
the credit cards available

Respuesta :

Zviko

Answer:

the value of collateral or down payment affect :

1. the amount borrowed

2. the repayment schedule

Explanation:

Only the amount borrowed and repayment schedule are affected by the value of collateral or down payment.

This is so because, the collateral or down payment instantly reduces the amount borrowed from the lender known as the Principle Amount.

Once the Principle amount is reduced, the instalments or repayment of interest and capital also reduces and some times the length of time for paying back the amount borrowed.

OlanmaE

The value of collateral or down payment affects:

  • The amount borrowed
  • The interest rate
  • The lender’s perceived risk

Collateral refers to an item of equal worth that is given to a lender to hold in case of a default in payment. The collateral or down payment that is deposited for a purchase will be equivalent to the amount borrowed.

A television set will not be equivalent collateral for a loan of $100,000. The collateral will also be measurable to the perceived risk of the lender.

The higher the perceived risk, the higher the collateral. The interest rate will also affect collateral. So, options 1, 2, and 3 are correct.

Learn more about collateral here:

https://brainly.com/question/14997152

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