Asked by Laura Phoenix on Jun 04, 2024
Verified
Under a pledging agreement, the borrower offers its receivables as collateral for a loan.
Pledging Agreement
An agreement where a borrower pledges an asset as collateral to secure a loan, ensuring the lender can seize the asset if the loan defaults.
- Discern the multiple types of collateral and their roles in guaranteeing loans.
Verified Answer
HH
Heather HarrisJun 10, 2024
Final Answer :
True
Explanation :
In a pledging agreement, the borrower pledges its receivables (accounts receivable or future receivables) as collateral for a loan. This provides security to the lender in case the borrower defaults on the loan.
Learning Objectives
- Discern the multiple types of collateral and their roles in guaranteeing loans.
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