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collateral

[ kuh-lat-er-uhl ]

/ kəˈlæt ər əl /

noun

security pledged for the payment of a loan: He gave the bank some stocks and bonds as collateral for the money he borrowed.

Anatomy.

a subordinate or accessory part.
a side branch, as of a blood vessel or nerve.
collateral circulation.

a relative descended from the same stock, but in a different line.

adjective

accompanying; auxiliary: He received a scholarship and collateral aid.

additional; confirming: collateral evidence; collateral security.

secured by collateral: a collateral loan.

aside from the main subject, course, etc.; secondary: These accomplishments are merely collateral to his primary goal.

descended from the same stock, but in a different line; not lineal: A cousin is a collateral relative.

pertaining to those so descended.

situated at the side: a collateral wing of a house.

situated or running side by side; parallel: collateral ridges of mountains.

Botany. standing side by side.

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Origin of collateral

1350–1400; Middle English (<Anglo-French ) <Medieval Latin collaterālis, equivalent to col-col-¹ + laterālislateral

OTHER WORDS FROM collateral

col·lat·er·al·i·ty

[koh-lat-uh-ral-i-tee], /koʊˌlæt əˈræl ɪ ti/, col·lat·er·al·ness, nouncol·lat·er·al·ly, adverb

Words nearby collateral

collaret, collarette, collar rot, collat., collate, collateral, collateral artery, collateral circulation, collateral damage, collateral fissure, collateral hyperemia

Dictionary.com Unabridged Based on the Random House Unabridged Dictionary, © Random House, Inc. 2020

FINANCIAL

What does collateral mean in loans?

Collateral is an asset, such as a home or a car, pledged by a borrower that a lender accepts as security against a loan in case the borrower for any reason cannot pay back the loan.

If a borrower fails to pay back a loan, the lender can seize the collateral and sell it in order to recover the loan amount.

Examples of collateral in a sentence

“A secured loan gets backed by some type of collateral, such as your vehicle or a savings account.”
—”What Is A Personal Loan?” Rocket Loans. Retrieved March 15, 2020.

“Since they don’t tend to have collateral attached, personal loans tend to come with higher interest rates than car and mortgage loans.”
—”The Best Ways To Finance Your Budding Business” Rocket Loans. Retrieved March 15, 2020.

“By contrast, an unsecured personal loan isn’t backed by collateral, which means that a lender will decide whether you qualify based on factors like your credit history and income.”
—”What Is A Personal Loan?” Rocket Loans. Retrieved March 15, 2020.

Example sentences from the Web for collateral

For the medical community, in particular, the war on drugs produced widespread collateral damage in the form of treatments undiscovered, in the form of human suffering unalleviated, in the form of scientific knowledge unattained.
How Are Psychedelics and Other Party Drugs Changing Psychiatry? (Ep. 433)|Stephen J. Dubner|October 1, 2020|Freakonomics
Soon, even their dream home was at risk as collateral for a line of credit from AvidBank.
The Mystery House: How a Suspicious Multimillion Dollar Real Estate Deal Is Connected to California’s Deadliest Fire|by Scott Morris, Bay City News Foundation|August 26, 2020|ProPublica
Sid Coelho-Prabhu, who is leading the Coinbase wallet initiative, says any loans consumers make on the platform are secure, since they are backed by borrowers’ collateral.
Crypto soars again as traders embrace ‘DeFi’ and ‘yield farming’—but some see echoes of the 2017 bubble|Jeff|August 25, 2020|Fortune
Most of these sites—notably Compound and Maker—rely on a decentralized network of lenders and borrowers, who use smart contracts to arrange collateral and payment terms.
Crypto soars again as traders embrace ‘DeFi’ and ‘yield farming’—but some see echoes of the 2017 bubble|Jeff|August 25, 2020|Fortune

The move comes in the wake of mounting concern about the scale of predatory lending given the proliferation of startups offering online, collateral-free loans in Kenya.
Kenya is doubling down on regulating mobile loan apps to combat predatory lending|Yomi Kazeem|July 23, 2020|Quartz
Horace had been playing poker with a mortician, who had put the car up as collateral.
Those Kansas City Blues: A Family History|Katie Baker|October 24, 2014|DAILY BEAST
In 2008, it was looking at a death spiral: cut credit ratings, claims on the policies, and collateral calls.
Remember the $182 Billion AIG Bailout? It Just Wasn’t Generous Enough|Daniel Gross|October 15, 2014|DAILY BEAST
The euphemism of “collateral damage” comes with that package.
Blood and War: The Hard Truth About ‘Boots on the Ground’|Clive Irving|September 22, 2014|DAILY BEAST
This can cause women to end up as collateral, even when they themselves have committed no wrong.
How India’s Honor Culture Perpetuates Mass Rape|Amana Fontanella-Khan|July 14, 2014|DAILY BEAST
The collateral effects, Drucker argues, show how imprisonment, human rights, and public health are related.
Economists Slam the War on Drugs in a New London School of Economics Report|Abby Haglage|May 6, 2014|DAILY BEAST
Collateral bonds are secured by the deposit of collateral security.
Cyclopedia of Commerce, Accountancy, Business Administration, v. 4|Various
I was naturally inquisitive as to his fortune and the collateral circumstances of his condition.
Memoirs of Carwin the Biloquist|Charles Brockden Brown
Malthus shows the necessity of observing other collateral results.
The English Utilitarians, Volume II (of 3)|Leslie Stephen
When used, Rapid Dominance would ensure favorable early resolution of issues with minimal loss of lives and collateral damage.
Shock and Awe|Harlan K. Ullman
A what-not education may be impressive, but is worthless as collateral.
Little Journeys to the Homes of the Great, Volume 11 (of 14)|Elbert Hubbard

British Dictionary definitions for collateral

collateral

/ (kɒˈlætərəl, kə-) /