Calculating Collateral: Understanding the Basics
How do you calculate collateral? Calculating the collateral coverage ratio is relatively simple: Collateral Coverage Ratio = (Discounted Collateral Value) / (Total Loan Amount) Used Equipment: ($50,000) x (50%) = $25,000. Used Equipment: ($25,000) / ($20,000) = 1.25. Used Equipment: ($25,000) / ($30,000) = 0.83. Read more on fitsmallbusiness.com A valuable asset is used as … Read more