collateralize
Back a loan
To collateralize is to pledge an asset as security for a loan or obligation.
If you collateralize a loan with your house, the lender can seize the property if you default.
The term appears primarily in finance and banking: The company collateralized its inventory to secure additional funding.
Collateralized debt is backed by specific assets; uncollateralized debt relies only on the borrower's promise to repay.
Secured home loan
- lienClaim securing debt
- pledgeBinding promise given
- hypothecatePledge without transferring ownership
- encumberTo burden or hinder
securitize · underwrite · borrower · lender · creditworthiness · default · foreclosure · repossession
Convert to tradeable securities
- bondBinding tie or connection
- indentureFormal binding contract
- trusteeOne managing another's assets
- escrowConditional third-party deposit
CDO · ABS · pooling · waterfall · originator · servicer · credit rating · pass-through
Impartial treatment or ownership value
- titleFormal honorific or name
- valuationAssessment of monetary worth
- appraisalEstimation of worth
- liquidateConvert assets to currency
ownership · property · inventory · receivables · real estate · securities · portfolio · chattel
Formal promise of fulfillment
- indemnifyGuarantee against loss
- suretyBacker of obligation
- hedgeBoundary of planted shrubs
- exposureState of being unprotected
subordinate · tranche · haircut · margin call · credit enhancement · counterparty · mitigation · backstop
mortgage
Secured home loan
- lienClaim securing debt
- pledgeBinding promise given
- hypothecatePledge without transferring ownership
encumber · securitize · underwrite · borrower · lender · creditworthiness · default · foreclosure · repossession · amortization
securitize
Convert to tradeable securities
escrow · CDO · ABS · pooling · waterfall · originator · servicer · credit rating · pass-through · senior
equity
Impartial treatment or ownership value
liquidate · ownership · property · inventory · receivables · real estate · securities · portfolio · chattel · tangible
guarantee
Formal promise of fulfillment
exposure · subordinate · tranche · haircut · margin call · credit enhancement · counterparty · mitigation · backstop · cushion