Investopedia explains 'Side Collateral'
When accepting side collateral (physical, financial or cash), the borrower will typically sign a security agreement that gives the lender legal authority to sell or dispose of the collateral if s/he does not repay the loan or debt obligation. The security agreement can also be filed with a public records office as the financing agreement between both parties.
An example of side collateral would be pledging $1,000 of assets to obtain a $10,000 loan.
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