Assets pledged to secure a loan. In some cases, the materials themselves may serve as collateral for the financing
Collateral refers to assets or property pledged by a borrower to secure a loan or financial obligation. In the event of default, the lender has the right to claim the collateral to recover the outstanding debt. Collateral can include real estate, machinery, inventory, or other valuable assets, and serves to reduce the lender’s risk by providing a tangible form of security for the borrowed funds.
Property pledged for a construction loan.
