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Risk of loan can be increased by your budget for instance not having proper and effective budget planning
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∙ 11y ago
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What problems would arise without financial intermediation?
The amount to loan Duration or maturity of loan Attitudes toward risk
What are the risk of a variable rate loan?
One of the risk of a variable rate loan is hat the interest rate will increase and therefore the money you have borrower monthly payment will increase to a point that you many not be able to repay. which can result in late fees, and even foreclosure and in some cases the lost of property if rate get too high and you decide to convert to a fixed-rate loan, be prepared to pay a conversion fee.
In general would interest rates for a personal loan be lower or high than those for a business loan?
In general the interest rates for a personal loan would be higher than for a business loan. The risk of losing money with business loan is not as high as with personal loan.
What do home equity loan rates do?
Home equity loan rates are second or third mortgage. The loan rates are based on loan risk. The bank sets higher rates for higher risk borrowers and lower rates for lower risk borrowers.
How does one add the closing cost to their home loan?
This could be done by taking out another loan on top of the loan which is already in place, although it would heavily increase the amount you owe and put you in horrific debt.
Which of the following would be an effect of emigration?
An increase in oil drilling would increase the risk of pollution.
What problems would arise without financial intermediation?
The amount to loan Duration or maturity of loan Attitudes toward risk
What are the risk of a variable rate loan?
One of the risk of a variable rate loan is hat the interest rate will increase and therefore the money you have borrower monthly payment will increase to a point that you many not be able to repay. which can result in late fees, and even foreclosure and in some cases the lost of property if rate get too high and you decide to convert to a fixed-rate loan, be prepared to pay a conversion fee.
In general would interest rates for a personal loan be lower or high than those for a business loan?
In general the interest rates for a personal loan would be higher than for a business loan. The risk of losing money with business loan is not as high as with personal loan.
Can I get a loan against an auto without a job?
I would say no, as you'd be a bad risk - no job so unable to pay back the loan.
What do home equity loan rates do?
Home equity loan rates are second or third mortgage. The loan rates are based on loan risk. The bank sets higher rates for higher risk borrowers and lower rates for lower risk borrowers.
How can you get a loan if im 18 years or older living with your parent that own there home?
Ask your parent to co-sign the loan, however that would make your parents responible and at risk if you default on the loan.
Would the cost of debt increase if the risk-free rate increases?
yes
How would the security market line shift if inflation decreased and investors became more risk adverse?
it will shift up, the slope will remain the same
Would banks decrease or increase interest rates if they had less money to loan?
If banks had less money to loan they would increase their interest rates. This is because they would have to make the most profit off of the little money that they had to use. When banks have a lot of money to loan, interest rates are lower because they can still get a lot of interest even from the lower interest rates.
What would happen to a monthly payment if the interest rate increased?
Either the monthly payment would have to increase or the period of the loan.
Why would the cost of debt increase if the risk-free rate increase?
The rate of return on a security, in this case the debt, is defined by rd = rRF + Liquidity Premium + Maturity Risk Premium + Default Risk Premium Thus increasing the risk free rate (rRf) should increase the cost of debt. Hopefully that answers your question...
