Does collateral reduces moral hazard by borrowers? Why?
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Does collateral reduces moral hazard by borrowers? Why?
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Solved in 2 steps
- What is the status of a lender on collateral if they fail to perfect their security interest? What risks do they face for failing to prefect?What is securitization? What are its advantages to borrowers?What are its advantages to lenders?How do you think participations affect the riskiness of a loan?
