Definitions from the Web
Term: Collateral
Description:
Collateral can be used as both a noun and an adjective. As a noun, collateral refers to something of value that is used to secure a loan or debt. It serves as a guarantee to the lender that if the borrower fails to repay the loan, the lender can sell the collateral to recover their money. As an adjective, collateral describes something that is accompanying or parallel to the main or primary thing.
Example Sentences:
- The bank required him to provide collateral in the form of his car in order to approve the loan.
- The company used their inventory as collateral to secure a line of credit.
- There were collateral damages caused during the construction project.
- The promotion campaign had a collateral effect on increasing sales.
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