Why do lenders often refuse to finance 100 percent of cost

Assignment Help Financial Management
Reference no: EM131410694

Why do lenders often refuse to finance 100 percent of the cost of a purchase, requiring borrowers to make a down payment that covers a portion (typically from 10 to 25 percent) of the purchase price?

After all, a lender could potentially earn more by financing the entire purchase amount.

Reference no: EM131410694

Questions Cloud

How should regional supply account for the situation : How should Regional Supply account for the situation? Briefly describe some of the factors that might affect how Regional Supply chooses to account for this situation.
What is the significance of being fluent in history : What is the significance of being fluent in history as it relates to critical thinking, e.g. Black history of Mexico? How do you think not knowing history contributes to un-critical thinking
Compute the cash payments made to suppliers during 2008 : Assume that accounts payable reflects only accounts with inventory suppliers, and compute the cash payments made to suppliers during 2008.
Minimum volume of pressurized oxygen : A person on a Haz Mat team will be working for 1.5 hr while breathing oxygen from a pressurized tank. While working, they will be burning energy at a rate of 250 Cal/hr. The tank stores the gas at 20 MPa. What minimum volume of pressurized ox..
Why do lenders often refuse to finance 100 percent of cost : Why do lenders often refuse to finance 100 percent of the cost of a purchase, requiring borrowers to make a down payment that covers a portion (typically from 10 to 25 percent) of the purchase price?
Record the sale of the gift certificates : Compute the balance in the unearned revenue account as of December 31, 2012, assuming that gift certificates were sold for $60,000 in 2012 and merchandise with a total price of $80,000 was redeemed.
Conduct research and deliver findings : Conduct research and deliver findings in professional settings.No matter how extensive the research or accurate the conclusions, a weak presentation can undermine an argument.
How do you find the right balance : On the other hand, being too optimistic could be detrimental to prospective investors or creditors. How do you find the right balance?
What is amnesty international and why is it so important : Pick one of the signs that you may see that lets you know that the end of the helping relationship is near and discuss how this sign may present itself. - (Client recognize problem has decreased or is gone) What is Amnesty International and why is ..

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

  Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

  Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

  Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

  Business finance task - capital budgeting

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

  Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

  Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

  Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

  Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

  Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

  Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

  Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd