Collateral

Collateral is a term that describes the personal property or assets offered by borrowers to lenders as security in order to secure loans. As part of these agreements, if payments are not made back on time, then collateral will be forfeit and become owned by the lender. A lien refers to an arrangement where a borrower's asset secures financing for both parties involved; this type of loan is called a secured credit line because it gives peace-of-mind knowing your money can't easily disappear with someone else without you getting something out of it first!