Loan Security Assignment

Security or collateral assignment in loans refers to the process by which a borrower pledges certain assets as security or collateral for a loan. In the event of default, the lender has the legal right to seize or sell the collateral to recover the outstanding loan amount. This assignment is a way for the lender to mitigate risk and ensure repayment, particularly in cases of secured loans.

Frappe lending allows users to assign multiple securities/collaterals against loans and enforce certain validations during the loan cycle.

To access the Loan Product, go to:

Home > Lending > Loan Security > Loan Security Assigment

1. Prerequisites

Before creating a Loan Security, it is advised to create the following:

• Loan Security

2. How to create a Loan Security Assignment

1. Go to the Loan Security Assignment List, and click on Add Loan Security Assignment.
2. Select the loan account against which the security/collateral has to be pledged.
3. Add the Loan Security, add security price manually if Loan Security Price is not configured
4. Save and Submit.