Danila, a Friend of Yours Who Is a Sole Trader

Danila, a friend of yours who is a sole trader, has recently taken out a bank loan of £12 000 to finance a planned expansion of her business.In a discussion about raising finance, she tells you four items of factual information.You realize that only one of them is correct: which one?

A) The bank manager says that by law all loans to sole traders must have a legal charge over them.
B) Unfortunately, this means that the interest rate is a bit higher than it would otherwise be.
C) It also means that this type of lending is riskier for the lender than unsecured lending.
D) However, the bank can get its money back by enforcing the charge if the business goes bust.