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a)If loans are granted for the purchase of an asset, then, practicable the asset should
be taken as security.
b)Where the purpose of the advance is to acquire a specific asset, e.g., a home loan
c)If it seems possible that repayment from an expected source is not forthcoming,
and no viable alternative source of repayment can be seen, then security should be
looked for.
d)Security acts as collateral or as an additional cushion should the promised source
of repayment fail to materialize in future.
e)Where the risks and consequences of the expected source of repayment failing are
such as to make it necessary to have a clearly defined and controlled alternative
source.
sharon kalunda answered the question on March 7, 2019 at 14:11