A secured loan requires the borrower to pledge an asset as security. Common examples include home loans, LAP, and LAS. Because the lender has recourse to collateral, secured loans offer lower interest rates, higher amounts, and longer tenures compared to unsecured loans.
In India, secured loans are governed by SARFAESI Act, 2002, which allows banks and financial institutions to recover non-performing assets without court intervention. While terms are better, the risk of losing the pledged asset on default is real.
Secured loans offer the most favorable terms but carry the risk of asset loss on default. Borrowers must be confident in their repayment ability.
Nihal Fintech specializes in secured lending including home loans, LAP, and LAS. We help clients leverage assets to access the best possible loan terms.
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