People need loans (bank loans atm) to live. To buy a car, a house, school, etc. Our society only works with loans.
So, if bitcoin becomes HUGE, how will the bitcoin loans work?
They will work just as FIAT loans. There are many loans on this forum, just go to the lending section and see it for yourself. If you take a good collateral, you shouldn't have any problems if the loan defaults. As you can see, a common sense is the most important, if you are giving a FIAT loan or Crypto loan.