hypothecation

Definition

The pledging of securities or other assets as collateral to secure a loan, such as a debit balance in a margin account.

Use hypothecation in a sentence

The hypothecation process was almost finished finally and we had to do things to make sure it went very smoothly.

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They knew that order to secure the loan they needed to pledge some securities and complete a hypothecation with the lender.

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The hypothecation was a necessary process because the creditor said we trust but need verification so we provided the collateral.

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rehypothecation margin agreement