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Asked by namish on :Jul. 07, 2015

What does a bank mean by Primary Security?

What does a bank mean by Primary Security?

What does a bank mean by Primary Security?

0

Chiranjibi Aug. 27, 2018

When an asset acquired by the borrower under a loan is offered to the lender as security for the financed amount then that asset is called Primary Security. In simple terms, it is the thing that is being financed.

Example: A person takes a housing loan of Rs 50 lakh from the bank and purchases a residential loan. That flat will be mortgaged to the bank as primary security.

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