A legal claim permitting the lender in case the borrower defaults, to liquidate the items serving as collateral to satisfy the obligation is called:
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A. B. C. D.B
The correct answer is B. Lien.
A lien is a legal claim or right against a property or asset as security for payment of a debt or obligation. In the context of lending, a lien is often placed on property or assets pledged as collateral by a borrower to secure a loan. The lender has the right to liquidate or sell the collateral to satisfy the debt if the borrower defaults on the loan.
Option A, Chattel mortgage, is a type of lien that involves personal property, such as equipment or vehicles, being pledged as collateral for a loan.
Option C, Collateral note, refers to a promissory note that is secured by collateral. It is a loan agreement that requires the borrower to pledge collateral to secure the loan.
Option D, Loan application, is simply the initial document that a borrower submits to a lender to request a loan. It does not relate to the legal claim or right against a property or asset as security for payment of a debt or obligation that is the subject of the question.
Therefore, the correct answer to the question is B. Lien, which is the legal claim permitting the lender to liquidate the items serving as collateral to satisfy the obligation if the borrower defaults.