The loan that is "Not Finalized" is a mode of financing that gives the applicant a greater flexibility.
The customer is not usually required to let the bank know about the destination of the applied loan. The payment
can then be used for many other purposes. The loan is targeted at financing at a fixed rate, with repayment of
capital by Equated Monthly Installments (EMI’s)
This is also called "secured" because its not needed to furnish actual guarantees by the customer. In fact the main
feature of the loans is not intended that the repayment of the loan is covered by appropriate safeguards provided by
the client. These enable and facilitate the disbursing of the loan applied for, and it is more flexible in conditions
compared to other modes of financing.
However, to limit the risk of eventual insolvency, [banks may require specific guarantees such as:
a. Guarantee
b Signature of a guarantor
c. Prior to signing a bill, guaranteeing a part of the sum in the event of default
d. Permission to collect the salary of the customer / debtor in case of default
e. Conclusion of insurance policies
Obviously, higher the amount required, more will be the specific guarantees demanded by the bank concerned.
It is difficult to establish the standard methods adopted by the financial institutions, because every case is rated
in isolation, considering the Credit Scoring of the client, so that there is maximum protection. There are various
forms of Loan Finalized, each of them addressed to different target customers in different ways. Amongst the most
common loans are the following:
1. Loan transfer of the fifth
2. Loan delegation
3 Loan Trust
4. Personal loan
