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Essay / Research Paper Abstract
This 12 page paper considers what is meant by a fixed and a floating charge where loans are made and the different rights associated with each type of charge. Looking at these two equitable charges as security for borrowed money the paper consider the level of freedom that this grants to the borrowers. The paper is written with reference to English law. The bibliography cites 6 sources.
Page Count:
12 pages (~225 words per page)
File: TS14_TEfixfloat.rtf
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Unformatted sample text from the term paper:
being missed, especially if interest rates are low and the company can make a return greater than the cost of the interest they would be paying. For this reason companies
may seek to make use of borrowing, Where this is short term financing may be obtained by way of credit form suppliers, meaning a delay in paying for gods after
they are delivered often an interest free way of obtaining credit. However, for longer term loans, either a fixed amount or for a system of revolving credit the businesses will
visit the bank or other financial institution to obtain the funds. Where there is borrowing, especially for some large amount the bank,
or other financial institution will want to have some type of security to ensure the money is repaid. However, the business will also want the ability to operate as usual
and the flexibly to use the assets, for this reason diffident types of charges have developed to facilitate the needs of the bank to protect their interests whilst allowing business
the freedom to continue. The most commonly used type of charge that will give freedom to use the assets is that if an equitable charge to two main forms
of which are fixed charges or a floating charge. An equitable charge is where the company will transfer the legal interest in
the property changed until the loan is paid off in full. An equitable charge is where there are not the meeting of the requirements necessary to meet a legal charge,
or the company does not have a legal interest in the property that was to be charged. In effect it gives the
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