PLEDGED ASSET Meaning and
Definition
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A pledged asset refers to any asset that is used as collateral to secure a loan or other type of financial obligation. When an individual or entity pledges an asset, they are basically offering it as a guarantee that they will repay the borrowed amount or fulfill the specified obligation. The asset can be in various forms such as real estate, vehicles, stocks, bonds, or any other valuable possessions.
The act of pledging an asset involves transferring legal ownership of the asset to the lender until the loan or obligation is fully satisfied. This transfer serves as a security measure for the lender, as they have the right to seize and sell the asset in case the borrower fails to meet their repayment obligations.
Pledged assets are commonly used in the lending industry to mitigate the risk faced by lenders. By requiring borrowers to pledge their assets, lenders have a form of security that can be liquidated to recover their funds in case of default.
It is important to note that the ownership of pledged assets can be regained by the borrower once the loan or obligation is successfully completed. This means that the lender no longer has a claim to the asset once it is fully paid off.
In summary, a pledged asset is an asset used as collateral to secure a loan or other financial obligation, providing a form of security for the lender in case of borrower default.
Common Misspellings for PLEDGED ASSET
- oledged asset
- lledged asset
- -ledged asset
- 0ledged asset
- pkedged asset
- ppedged asset
- poedged asset
- plwdged asset
- plsdged asset
- plddged asset
- plrdged asset
- pl4dged asset
- pl3dged asset
- plesged asset
- plexged asset
- plecged asset
- plefged asset
- plerged asset
- pleeged asset
- pledfed asset
Etymology of PLEDGED ASSET
The word "pledged asset" does not have a specific etymology of its own. Instead, it is a compound term derived from the combination of two separate words: "pledged" and "asset".
Here is the etymology for each of the individual words:
1. Pledged: The word "pledged" comes from the Old French term "plegier", which means "to promise" or "to guarantee". It can be traced back to the Latin word "plācāre", meaning "to calm" or "to appease".
2. Asset: The word "asset" has a different etymology, derived from the Old French word "acetz" or "assez", meaning "enough" or "sufficient". It ultimately originates from the Latin word "adhuc", which means "up to this time" or "so far".
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