If Tshegofatso is applying for a loan for a shelving system to improve her retail sales where the system will serve as collateral, what type of loan would be the most appropriate?
A)Chattel mortgage
B)Line of credit
C)Real estate mortgage
D)Term loan

Question

Quizplus · Accepted Answer

A chattel mortgage is a loan that uses personal property such as equipment, vehicles or inventory as collateral. Since the shelving system is a piece of equipment, a chattel mortgage would be the most appropriate type of loan for Tshegofatso to apply for. The lender would have the right to seize the shelving system if Tshegofatso was unable to repay the loan.

If Tshegofatso Is Applying for a Loan for a Shelving