Collateral Types

An asset pledged as security for repayment of a loan

Real Estate

  • Borrowers Pledge Their Property as Security for Mortgages and
  • Home Equity Loans
  • Preferred by Lenders Due to Its
    Stability and Value


  • Borrowers Pledge Their Vehicle as Collateral for Auto Loans and
    Title Loans
  • Lenders Prefer Vehicles as
    Collateral Due to Their Liquidity


  • Borrowers Pledge Their Valuables as security for the loan
  • Preferred by lender because value of equipment is greater than loan received by borrower so less risk for lender

Other Financial Assets

  • Savings Accounts, Certificates of Deposit, and Other Types of Investments Can Be Used as
  • Collateral
  • These Assets Are Highly Liquid and Easily Convertible to Cash

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