Which term is defined as property that is pledged as security on a loan?
DEFINITION of 'Security Agreement'. A document that provides a lender a security interest in a specified asset or property that is pledged as collateral.In the event that the borrower defaults, the pledged collateral can be seized and sold. A security agreement mitigates the default risk the lender faces.Next Up.EFINITION of 'Security Agreement'. A document that provides a lender a security interest in a specified asset or property that is pledged as collateral. A security interest is a property interest created by agreement or by operation of law over assets to secure the performance of an obligation, usually the payment of a debt.It gives the beneficiary of the security interest certain preferential rights in the disposition of secured assets.he security interest is established with respect to the property, if the debtor has an ownership interest in the property and the holder of the security interest conferred value to the debtor, such as giving a loan. A contract of pledge specifies what is owed, the property that shall be used as a pledge, and conditions for satisfying the debt or obligation. In a simple example, John asks to borrow $500 from Mary. Mary decides first that John will have to pledge his stereo as security that he will repay the debt by a specific time.In law John is called the pledgor, and Mary the pledgee. The stereo is referred to as pledged property.n a simple example, John asks to borrow $500 from Mary. Mary decides first that John will have to pledge his stereo as security that he will repay the debt by a specific time. In law John is called the pledgor, and Mary the pledgee. The stereo is referred to as pledged property. pledge. v. to deposit personal property as security for a personal loan of money. If the loan is not repaid when due, the personal property pledged shall be forfeit to the lender. The property is known as collateral.To pledge is the same as to pawn.n a simple example, John asks to borrow $500 from Mary. Mary decides first that John will have to pledge his stereo as security that he will repay the debt by a specific time. In law John is called the pledgor, and Mary the pledgee. The stereo is referred to as pledged property. A secured loan is a loan in which the borrower pledges some asset (e.g. a car or property) as collateral for the loan, which then becomes a secured debt owed to the creditor who gives the loan.he debt is thus secured against the collateral — in the event that the borrower defaults, the creditor takes possession of the asset used as collateral and may sell it to regain some or all of the amount originally loaned to the borrower, for example, foreclosure of a home. A mortgage, or more precisely a mortgage loan, is a long-term loan used to finance the purchase of real estate. As the borrower, or mortgager, you repay the lender, or mortgagee, the loan principal plus interest, gradually building your equity in the property. loan used to buy real estate. A mortgage is secured by the property it is used to purchase. One must make monthly payments on a mortgage, and there is a set term before full payment is due, often 15, 20, or 30 years. The debt is thus secured against the collateral — in the event that the borrower defaults, the creditor takes possession of the asset used as collateral and may sell it to regain some or all of the amount originally loaned to the borrower, for example, foreclosure of a home.he debt is thus secured against the collateral — in the event that the borrower defaults, the creditor takes possession of the asset used as collateral and may sell it to regain some or all of the amount originally loaned to the borrower, for example, foreclosure of a home. Under Article 9, a security interest is created by a security agreement, under which the debtor grants a security interest in the debtor's property as collateral for a loan or other obligation.he security interest is established with respect to the property, if the debtor has an ownership interest in the property and the holder of the security interest conferred value to the debtor, such as giving a loan. In a non secure loan agreement, negative pledge clause is added to prevent a borrower from obtaining any secured loan with an unsecured lender’s permission. This clause creates an agreement that a borrower will not pledge any property to another person because it will result in less security to the unsecured lender.Negative pledge clauses give priority claims to a lender over the borrower’s assets. Negative pledge clauses are common in unsecured commercial loan document.his clause creates an agreement that a borrower will not pledge any property to another person because it will result in less security to the unsecured lender. Negative pledge clauses give priority claims to a lender over the borrower’s assets. Negative pledge clauses are common in unsecured commercial loan document. pledged loan -- A mortgage loan that has been identified and set aside as security for borrowing by the holder of the mortgage; particularly a loan that has been pledged as se … curity for an advance from a Federal Home Loan Bank. 2 people found this useful.ecured homeowner loans are only available to people owning a home which has a mortgage on their property. Those loans are often called second charge loan. The lender secure t … heir investment by claiming the house in case one cannot keep up with the rates.
Security Agreement