Question

What is "collateral" in relation to loans? ​

Answer 1

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Collateral is an asset that a lender accepts as security for a loan. If the borrower defaults on the loan payments, the lender can seize the collateral and resell it to recoup the losses.

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Answer 2

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Collateral

Collateral is an asset that Borrower owns and uses this guarantee to lender until the loan is repaid .