Did you know that borrowing, of which a loan is part, has become a necessary evil? Well, that is the hard truth we all have to agree with. The issue of how it became so will be a beautiful discourse for another time. But, not to jump the gun, several reasons may have accounted for that, including both unexpected and planned expenses. Loans may come in different forms and for varied purposes, such as financing a business venture, attending to an emergency, or undertaking a project, among others. However, this article will delve deeper into the collateral type of loans, which can sometimes be much easier to secure if you find the right lender like SRF Micro Credit.

A collateral loan is a secured loan where the borrower pledges or gives an asset, called collateral, to the lender in exchange for a loan. In many cases, if the borrower refuses to honor their part of the contract, the lender has the onus to seize the asset to recover the loan amount. This type of loan offers faster access to funds, especially for individuals with limited or no credit history. A few examples of collaterals accepted in Ghana are vehicles, land documents, electronics, and houses, among others, depending on the amount involved.  It is also worth mentioning a few institutions, such as microcredit and microfinance institutions, savings and loans companies, traditional banks, and credit unions, where one can get collateral loans. 

Having explained the subject of focus, now let’s go through a simple but relevant step-by-step way to get a quick yet authentic collateral loan in the Ghanaian market.

1. Identify a reputable lender

One of the first things to think of when it comes to borrowing after you have settled on the amount to secure is to identify an authentic lender. Don’t be deceived; there are so many unlicensed lenders in the space who are not authorised by the Bank of Ghana (BoG) to do such business. They only exist by pretense, and their goal is simple: to extort money from their victims using threats and reputational damages like posting their victims' pictures online, among others, but not to provide financial solutions. Therefore, if anyone does business with them, it is a risky venture because anything can happen. Some of the best ways to identify authentic lenders are to research online, verify their location, or ask for referrals. Taking these simple steps can save you a great deal from falling prey to fraudsters who will compound your problems. 

2. Prepare required documents

Once you have identified a lender, the next step is to prepare the required documents. This may include, but is not limited to ID, collateral proof, etc. You can also speak with the company in question to understand the requirements or items needed, since they vary. Make sure all your documents are ready before visiting the firm, because that would help reduce the turnaround time and facilitate a faster loan disbursement. 

3. Collateral valuation

Another key thing is to get your collateral valued by a credible and certified asset valuation company before you go to the lender, if possible. This is mostly trivialized, but I bet you, it will save you a lot of time if you get that done before.  That is crucial because every genuine lender would only offer you a loan in proportion to the value of your collateral. That means that any lender willing to lend beyond the value of your collateral may be a red flag that they are not authentic. However, there are cases where the lender wants to be part of the collateral valuation process and hence, would request you come to their office without any pre-valuation. 

4. Loan approval and disbursement

Once the valuation process, plus verification of documents and ownership of the collateral, including other details, are certified, the lender will either agree with the amount you are seeking or propose a different amount based on certain conditions. However, there is always an opportunity to negotiate, sometimes with the lender on the amount. Once the amount is agreed upon and the terms and conditions are ok with you, the borrower, the loan is disbursed mostly within 72 hours or instantly in the case of SRF Micro Credit. 

But, always make sure before signing the loan agreement, you watch out for the interest being charged, repayment schedule, hidden charges such as penalties, and possibly, the recovery terms in case you default.

To conclude, we live in a time when financial demands can hit without warning, or dreams need funding to take off, which calls for a reliable, fast, and safe lending partner like SRF. Whether you're looking to stabilize your business, pay urgent bills, or take advantage of a timely opportunity, collateral loans remain one of the most effective ways to access funds quickly. SRF stands out as a trusted and licensed institution dedicated to offering Ghanaians flexible and quick loans, including collateral ones. With SRF, you don't just get a loan, you get peace of mind, professional service, and a partner committed to your success. So, why risk it with unlicensed lenders or delay that next step in your life or business?

Visit SRF today at Lapaz, Main Traffic Light - Adjacent Ecobank in Accra for help.
📞 Or call on 0575621363 / 0240061709

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