hypothecation loan definition
Hypothecation refers to the pledging of assets as collateral for a debt, and it means that certain assets may be at risk if you can't pay your bills. Defined broadly, hypothecation refers to the practice of pledging an asset as collateral for a loan while still retaining ownership, as is commonly done to obtain a mortgage on a house. Here is an overview of the various types of hypothecation and how it could affect you. Hypothecation in lending.