Cross Collateralization Definition Types Example
What is Cross-Collateralization? Cross collateralization is a phrase used when collateral from one loan is reused further as collateral for another loan, thereby increasing the leverage for the borrower and increasing the lending capacity of the bank or the lender. It is specifically implemented when an asset or multiple assets collateralize CollateralizeCollateralization is derived from the term “collateral,” which refers to a security deposit made by a borrower against a loan as a guarantee to recover the loan amount if s/he fails to pay....