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Loan Collateral

Security On Loans

It shall be the policy of the Credit Union to ensure that each loan granted shall have adequate security. Each loan granted MUST have a cash security in the society. The amount needed will vary depending on factors such as loan category, member’s history in the society, age of item being purchased. 

Loans can be secured by one or more of the following:

  1. Borrower’s own savings (shares)
  2. Bill of Sale on vehicle
  3. Life Insurance policy/policies – to a maximum of 90% of cash surrender value
  4. Co-maker’s shares
  5. Mortgage (Hypothec Obligation) on land (priority would be given to first mortgages rather than second mortgages)
  6. Mortgage (Hypothec Obligation) on land and building
  7. Hypothecation of Term Deposits
  8. Assignment of shares, bonds and treasury bills (only 70% of the market value of shares pledged as security)
  9. Debenture on the fixed and floating assets of a company