Collateralize

Pronunciation: /kəˈlætərəˌlaɪz/

Collateralize (verb)

  1. To give an asset as security for a loan or promise to pay, so the lender can take it if you do not pay.
  2. To provide something valuable to reduce risk in a deal, so one side has protection if the other side fails.

Examples

  • You can collateralize your property to secure a loan.
  • The bank asks borrowers to collateralize assets to secure a loan.