Discussion about 'Collateral' in Btctalk lending section

JeffBrad12

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Quote from: lumeire on March 11, 2017, 03:18:27 AM

Quote from: JeffBrad12 on March 03, 2017, 06:49:12 PM

Quote from: webtricks on March 02, 2017, 11:47:56 AM

It is general practice that collateral worth is always greater than amount of loan offered. In terms of bank, it is known as 'Margin Requirement'.
But banks are trusted institutions as compared to individuals here. So my concern is that, since lenders here generally accept collateral higher than loan amount, what is the credibility they will return collateral when borrower is willing to pay back?
Isn't there should be a system of escrow holding security/collateral?

That's why the borrower tries to choose the trusty person in the lending section. And otherwise. The lenders try to choose the trusty borrowers.

It makes the transaction will run for smoothly, and we are no need an escrow for that. A key is a trusty person.

Which is a rarity nowadays. Account levels doesn't even matter that much anymore. Anyway, I haven't had a chance to experience borrowing or lending btc in the lending section here but I suppose the borrower gives a collateral with the margin mind, much like the lender's interest rates, so it's a win-win.

Yeah the lender never give amount which the amount is more than the collateral's value.

HabBear

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I see collateral talked about, but I've never seen it actually used for lending.

How is anyone supposed to provide collateral? A bank will take the deed to your home or the title of your car or some other physical ownership to represent their control. OR they'll make the borrower sign a contract entitling them to the collateral int he case of loan default. How would this work in the bitcoin world where transactions are global and anonymity is supposed to be paramount?

If collateral is accepted regularly I don't think there's any standard margin requirement. It depends on the lender, the borrower, the terms of the loan.

Qartersa

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Quote from: SikatBray on March 11, 2017, 11:02:12 AM

Quote from: lumeire on March 11, 2017, 03:18:27 AM

Quote from: JeffBrad12 on March 03, 2017, 06:49:12 PM

Quote from: webtricks on March 02, 2017, 11:47:56 AM

It is general practice that collateral worth is always greater than amount of loan offered. In terms of bank, it is known as 'Margin Requirement'.
But banks are trusted institutions as compared to individuals here. So my concern is that, since lenders here generally accept collateral higher than loan amount, what is the credibility they will return collateral when borrower is willing to pay back?
Isn't there should be a system of escrow holding security/collateral?

That's why the borrower tries to choose the trusty person in the lending section. And otherwise. The lenders try to choose the trusty borrowers.

It makes the transaction will run for smoothly, and we are no need an escrow for that. A key is a trusty person.

Which is a rarity nowadays. Account levels doesn't even matter that much anymore. Anyway, I haven't had a chance to experience borrowing or lending btc in the lending section here but I suppose the borrower gives a collateral with the margin mind, much like the lender's interest rates, so it's a win-win.

Yeah! I agree with your comment.
Also, there is much fraud in account levels these days. One can see many threads selling green trust Hero/Legendary accounts in forum for sale!!

That is the current plague in this forum. Account that have so much trust ratings and high level are constantly for sale nowadays. But, I think bigger collateral is still the option for everybody. Without a bigger collateral than the loan then the lender is not protected. If the prices of bitcoins shoot up by 100%, do you think the borrower will come back for the loan? And if he doesn't, how will the lender recover his money and the lost opportunity?

SikatBray

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Quote from: lumeire on March 11, 2017, 03:18:27 AM

Quote from: JeffBrad12 on March 03, 2017, 06:49:12 PM

Quote from: webtricks on March 02, 2017, 11:47:56 AM

It is general practice that collateral worth is always greater than amount of loan offered. In terms of bank, it is known as 'Margin Requirement'.
But banks are trusted institutions as compared to individuals here. So my concern is that, since lenders here generally accept collateral higher than loan amount, what is the credibility they will return collateral when borrower is willing to pay back?
Isn't there should be a system of escrow holding security/collateral?

That's why the borrower tries to choose the trusty person in the lending section. And otherwise. The lenders try to choose the trusty borrowers.

It makes the transaction will run for smoothly, and we are no need an escrow for that. A key is a trusty person.

Which is a rarity nowadays. Account levels doesn't even matter that much anymore. Anyway, I haven't had a chance to experience borrowing or lending btc in the lending section here but I suppose the borrower gives a collateral with the margin mind, much like the lender's interest rates, so it's a win-win.

Yeah! I agree with your comment.
Also, there is much fraud in account levels these days. One can see many threads selling green trust Hero/Legendary accounts in forum for sale!!

lumeire

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Quote from: JeffBrad12 on March 03, 2017, 06:49:12 PM

Quote from: webtricks on March 02, 2017, 11:47:56 AM

It is general practice that collateral worth is always greater than amount of loan offered. In terms of bank, it is known as 'Margin Requirement'.
But banks are trusted institutions as compared to individuals here. So my concern is that, since lenders here generally accept collateral higher than loan amount, what is the credibility they will return collateral when borrower is willing to pay back?
Isn't there should be a system of escrow holding security/collateral?

That's why the borrower tries to choose the trusty person in the lending section. And otherwise. The lenders try to choose the trusty borrowers.

It makes the transaction will run for smoothly, and we are no need an escrow for that. A key is a trusty person.

Which is a rarity nowadays. Account levels doesn't even matter that much anymore. Anyway, I haven't had a chance to experience borrowing or lending btc in the lending section here but I suppose the borrower gives a collateral with the margin mind, much like the lender's interest rates, so it's a win-win.

JeffBrad12

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Quote from: webtricks on March 02, 2017, 11:47:56 AM

It is general practice that collateral worth is always greater than amount of loan offered. In terms of bank, it is known as 'Margin Requirement'.
But banks are trusted institutions as compared to individuals here. So my concern is that, since lenders here generally accept collateral higher than loan amount, what is the credibility they will return collateral when borrower is willing to pay back?
Isn't there should be a system of escrow holding security/collateral?

That's why the borrower tries to choose the trusty person in the lending section. And otherwise. The lenders try to choose the trusty borrowers.

It makes the transaction will run for smoothly, and we are no need an escrow for that. A key is a trusty person.

Potato Chips

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Quote from: Vaccinus on March 03, 2017, 11:55:20 AM

why they should steal your collateral when you have their money? usually the one that ask for money should take the risk for this, because he is the scammer not the opposite, and the lender is most of the time a trusted person

Exactly, They are not dumb enough to do that. Even if the lender runs off with the loaners collaterals and lets say that if he sells it

he will gain a at least 60% profit from it. In the end of the day its the lenders lose because that profit will be a one time only,

Compared to the profit you will earn here lending in a year its just a dust. Take note that if you lend here for a long time, People

will trust you more and if they do many people will apply a loan = more profit.

Vaccinus

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why they should steal your collateral when you have their money? usually the one that ask for money should take the risk for this, because he is the scammer not the opposite, and the lender is most of the time a trusted person

passwordnow

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Most of the lenders here seems to be trusted and actually they are not into collateral, there are even some lenders that aren't requiring collateral. It's a matter of building reputation here in forum. And if you will be a borrower and you aren't that sure about your lender, then you can simply ask an escrow for it.

BitcoinGirl.Club

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Quote from: webtricks on March 02, 2017, 11:47:56 AM

So my concern is that, since lenders here generally accept collateral higher than loan amount, what is the credibility they will return collateral when borrower is willing to pay back?
Isn't there should be a system of escrow holding security/collateral?

To be honest lenders are usually the victims from this service because of defaults and all collateral handled is always in safe hands with them or escrow, that's why its important to always sign a message to prove this transaction did happen.

thebatletbet

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Quote from: webtricks on March 02, 2017, 11:47:56 AM

It is general practice that collateral worth is always greater than amount of loan offered. In terms of bank, it is known as 'Margin Requirement'.
But banks are trusted institutions as compared to individuals here. So my concern is that, since lenders here generally accept collateral higher than loan amount, what is the credibility they will return collateral when borrower is willing to pay back?
Isn't there should be a system of escrow holding security/collateral?

if you not believe some person in lending section service you can use escrow
you can use reputable escrow in listed in bitcointalk you can read in here https://bitcointalksearch.org/topic/bitcointalk-escrows-trade-safely-855778 , in there staff ready open escrow service too example dabs
if you not still believe escrow , don't loan don't borrow in lending section service is just simple you can borrow in local bank youre country

Snorek

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I understand you concern Op. But listen. Lender is usually known individual, obviously still anonymous, an can in theory scam you and steal your collateral.
But it is better for lender to be trustworthy, lend money constantly and in the long run he would earn more than during one time exit scam.

I imagine that desire to steal collateral may appear only when collateral is FAR MORE valuable that the amount of money lent.
But then again, why would you, as a borrower want to offer something like that?

neochiny

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The majority forego the use of escrow, especially for small loans or where the collateral is a bitcointalk account. They just make sure to either choose
a reputable/well-known lender or the one they 'trust'/have had previous deals with.

As for altcoins collateral, some would use escrows, especially for big loans.
Usually, it's the first-timers or big loans/collateral that ask for escrow. Anyway, the option is there, use it or not, it's up to you.

DarkStar_

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Quote from: unholycactus on March 02, 2017, 03:35:39 PM

I haven't seen any account of people stealing the collateral.
Like someone pointed out, most people use escrow anyways.

Uh, no? For all the loans I've filled where they offered collateral, I held the collateral. Even for ~0.8BTC worth of altcoins at the time, when I wasn't that trusted. If you take a look at all the other lenders as well, they've held the collateral probably 99% of the time. Lending is quite profitable if you do it right, so people wouldn't need to exit scam by keeping someone's collateral unless it's someone with no reputation or anything.

unholycactus

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I haven't seen any account of people stealing the collateral.
Like someone pointed out, most people use escrow anyways.

pixie85

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What you're proposing is already in use. Escrows are known to hold collateral like coins and forum accounts for people.
We don't have banks here, so you will ultimately have to trust some forum users if you want to buy something or get a loan.

kotwica666

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Quote from: webtricks on March 02, 2017, 11:47:56 AM

It is general practice that collateral worth is always greater than amount of loan offered. In terms of bank, it is known as 'Margin Requirement'.
But banks are trusted institutions as compared to individuals here. So my concern is that, since lenders here generally accept collateral higher than loan amount, what is the credibility they will return collateral when borrower is willing to pay back?
Isn't there should be a system of escrow holding security/collateral?

Of course you can request escrow, but usually lender ask you to cover costs of this service. It is like on free market - there are users that offer different interest rates and collateral restrictions. You can choose te best one or resign, but as i know always you can ask for escrow - and to be honest i recommend this option.. Just be careful and select the proper and honest escrow.

webtricks

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It is general practice that collateral worth is always greater than amount of loan offered. In terms of bank, it is known as 'Margin Requirement'.
But banks are trusted institutions as compared to individuals here. So my concern is that, since lenders here generally accept collateral higher than loan amount, what is the credibility they will return collateral when borrower is willing to pay back?
Isn't there should be a system of escrow holding security/collateral?

Topic: Discussion about 'Collateral' in Btctalk lending section (Read 699 times)