Loans can be secured with collateral (if the feature is enabled in the configuration). The ability and obligation to use collateral depends on the credit product settings.
If the feature is enabled, customers will be able to enter details of their collateral when applying for a loan. A back-office user with the "Collateral Management" permission can then manage, evaluate, and re-evaluate collateral assets within the dedicated Collateral workspace. For more information, refer to the Lender Collects and Maintains Information about the Collateral article.
Max LTV
For each credit product, you can define the Maximum Loan to Value (LTV) Ratio.
A loan cannot be approved if the LTV ratio exceeds this limit, ensuring that the loan amount remains proportionate to the value of the collateral.