As mentioned previously, the bank regulators decide whether the loan is secure enough by assessing the risks and benefits of committing cash to the debtor. If a bank determines that a customer poses minimal risk, it will probably enable the client to keep paying back its own loan. On the other hand, a bank regulator might find that the borrower poses too much risk to give money. In that case, the bank will induce the loan to be refinanced to get better terms. Once the lender corrects the loan, the debtor is forced to either agree to cover the new provisions or mortgage.
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