A valuable asset pledged to assure loan payments and which can be seized upon default is called:

Question

Quizplus · Accepted Answer

Collateral refers to a valuable asset that is pledged as security for repaying a loan. In case of default, the lender can seize the collateral to recover the outstanding amount. Capacity refers to a borrower's ability to make loan payments, character refers to the borrower's reputation and creditworthiness, capital refers to the borrower's financial resources, and conditions refer to the terms and conditions of the loan agreement.

A Valuable Asset Pledged to Assure Loan Payments and Which