Collateral is an item of value used to secure the principal portion of a loan.

Name: Collateral is an item of value used to secure the principal portion of a loan.
Brand: Quizplus
Rating: 4.9 (40 reviews)

Question

Quizplus · Accepted Answer

Collateral is an asset that is pledged as security for a loan. If the borrower fails to repay the loan, the lender can seize the collateral to recover their losses. The principal portion of the loan is the amount borrowed by the borrower.

Collateral Is an Item of Value Used to Secure the Principal