MoneyKraft

1. Which of the following factors is NOT considered while deciding the rate at which the loan is offered?

Whether the loan is secured or unsecured

Your current income

Your credit score

2. What is the advantage of offering a collateral when taking loan?

It guarantees you a loan

It reduces the rate of borrowing for the loan

It improves your credit score

3. What does the Credit score indicate?

Your willingness to pay back the loan

Your ability to payback the loan

Amount of outstanding debt that you have

4. Ideally EMIs or loan repayment should form what percent of your income

75% to 80%

Below 40%

50% to 60%

5. Which of the following is used to determine your ability to payback the loan?

Your personal stake in the asset for which you are availing the loan

Your Credit score

Your current and potential future income

Factors that impact rate and amount of your loans & borrowing

loans and borrowing

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Level - 6,3,8,6 BASIC

Borrowers need to convince lenders about their ability and willingness to repay on the basis of collateral, income statements or credit scores. Watch this video to learn about the factors that influence amounts and rates for formal loans.

AUTHOR(s):Uma Shashikant

Factors that impact rate and amount of your loans & borrowing

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