Which of the following is NOT a feature that makes a secured loan less costly than an unsecured loan?

A high interest rate

Collateral

Less risk for the financial institution

All of these are correct

High interest rate

Explanation:

A secured loan is a type of loan that is borrowed with some assets used as collateral in case of any default in the terms of loans by the borrower. This makes the risk to be lower as the issuing party can easily disposed the assets on which it is secured to recover its money in case the borrower defaults.

The reduced risk also reduces the interest rate as the relationship between the two is directly related.