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collateral often called collateral security is an asset thats been pledged by a borrower to A lender in support of a credit request examples of collateral include a vehicle for a car loan a house or other type of property for a mortgage loan or even marketable Securities like stocks and bonds for a margin Loan in an Investment Portfolio when a specific asset is pledged as collateral for a loan the credit exposure is said to be secured as opposed to credit extended without specific underlying collateral which is called unsecured borrowing an asset becomes collateral when the lender registers a security interest often called a lien or a charge that lien could be against the serial number of a specific vehicle or against title of a specific property sometimes the security charges registered against all assets of a borrower which is very common in commercial lending this is typically registered using whats called a general security agreement and it covers all assets that cant necessaril
