A man without a job goes to you to ask for a loan. He wants the money for a trip.
You perceive a high risk and demand a 100% yearly interest rate. He accepts.
Did you make the right choice as the lender?
Lending has a ceiling on the capacity of the borrower to default. The issue with student loans is that the lender has no downside to giving defaultable loans.
You perceive a high risk and demand a 100% yearly interest rate. He accepts.
Did you make the right choice as the lender?
Lending has a ceiling on the capacity of the borrower to default. The issue with student loans is that the lender has no downside to giving defaultable loans.