A valuable asset pledged to assure loan payments and subject to seizure upon default is called:
A) capacity.
B) character.
C) capital.
D) collateral.
E) conditions.

Question

Quizplus · Accepted Answer

Collateral is a valuable asset pledged to assure loan payments and subject to seizure upon default. Capacity refers to a borrower's ability to repay a loan, character refers to a borrower's trustworthiness and reputation, capital refers to a borrower's financial resources, and conditions refer to any specific terms and requirements of a loan.

A Valuable Asset Pledged to Assure Loan Payments and Subject