Collateral

An asset that is pledged as security for a loan. The borrower risks losing the asset if the loan is not repaid according to the terms of the loan agreement. In the case of a mortgage, the collateral would be the house and property.

Something of value pledged as security for a loan. In mortgage lending the property itself serves as collateral for a mortgage loan.

Security in the form of money or property pledged for the payment of a loan. For example, on a home loan, the home is the collateral and can be taken away from the borrower if mortgage payments are not made.

Something pledged as security for a debt.

Assets that are offered to secure a loan or other credit. For example, if you get a real estate mortgage, the bank's collateral is typically your house. Collateral becomes subject to seizure on default.

Property offered as security, usually as an inducement to another party, to lend money or extend credit.

Assets that are offered to secure a loan or other credit. For example, if you obtain a real estate mortgage, the credit's collateral is typically your house. Collateral becomes subject to seizure on default.

Assets with monetary value, such as stock, bonds, or real estate, which are used to guarantee a loan, are considered collateral.

If the borrower defaults and fails to fulfill the terms of the loan agreement, the collateral, or some portion of it, may become the property of the lender.

For example, if you borrow money to buy a car, the car is the collateral. If you default, the lender can repossess the car and sell it to recover the amount you borrowed.

Loans guaranteed by collateral are also known as secured loans.

Property, such as stocks, house, bonds, bank account, or a car, offered to secure a loan and which is subject to seizure if you default; see security.

Assets used as security for a loan that can be seized by the lender if the borrower fails to repay the loan.

Security, cash or something of value, deposited by the party owing money to the party to whom money is owed, to help assure that payables will be paid when due. The collateral is called for when the pre-established credit limit has been reached. In commodity markets, such payables arise from every physical or financial transaction where cash is paid upfront. Margin at a futures exchange is one form of collateral.