You might have been hearing the word loan liquidation being thrown around very often.

Here's what it means - Loan liquidation refers to the process of selling off assets used as collateral to repay a loan if the borrower defaults. This can happen with any loan type, not just self-liquidating loans.

Self-liquidating loans are a type of short-term loan where the borrowed funds are used to purchase assets that are then sold to repay the loan.

This can be a good option for businesses that need to purchase inventory or other assets that will be quickly sold and generate cash.

Source: https://www.loanspot.ng/loan-liquidation-meaning-and-how-to-liquidate-your-loan/