Bank Collapse

[Mkk1982]

What happens if a bank collapses that you hold a loan with? Is the loan waived or do you continue to pay it back?

[Ethel]

No, the loan is not waived and yes, you have to pay it back to whoever takes over the administration of the bank.

Loans are the banks assets,and it is likely they would be sold on to another bank, to whom you would owe the money