👉 Loan engineering is the specialized practice of designing, structuring, and optimizing loan products to meet the needs of both lenders and borrowers while maximizing profitability and risk management. It involves crafting terms such as interest rates, repayment schedules, collateral requirements, and loan covenants to attract borrowers and minimize default risks. By tailoring these elements, lenders can create competitive and attractive loan offerings, while also ensuring compliance with regulatory requirements. Advanced analytics and financial modeling are often employed to predict borrower behavior, assess creditworthiness, and optimize loan performance, ultimately enhancing the efficiency and effectiveness of lending operations.
