In this chapter, we continue our discussion of lending, focusing on major types of loans and issues that typically arise from the private transactions between borrowers and lenders, with reference to the NCCPA whenever relevant. Lending often goes hand in hand with some sort of security. Such security serves as legal protection in case of a default. Depending on the nature of the loan, security can take different forms: lenders may take security over a borrower’s property, whether real (eg a house) or personal (eg vehicles). Taking security over the real property interests of a borrower enables the lender to exercise certain rights against the property in the event of default. The most usual form of security is a mortgage. Alternatively, guarantees are common in Australia’s financing transactions. To be sure, lending is a complicated process; creating and registering security interests for financing can be equally, if not more, problematic in practice. The issues discussed herein are, therefore, not exhaustive.
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