Assets pledged by a borrower to secure a loan or other credit, and subject to seizure in the event of default. also called security.

Use collateral in a sentence

We assessed if there would be any collateral damage as a result of our actions the other day at the meeting.

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The car dealership requires you to leave your own keys or ID card as collateral when taking one of their vehicles on a test drive.

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In order for John to receive the loan he has requested he must ensure has something of value worth $10,000 as collateral. Without that the bank will not make the loan.

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mortgage equity withdrawal (MEW) loss given default