Pledging

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Related to pledge: Pledge of Allegiance

Pledging

Hypothecate

To pledge an asset as collateral on a loan without the lender taking possession of the collateral. It especially applies to mortgages: the borrower hypothecates when he/she pledges the house as collateral for payment of the mortgage, or he/she may hypothecate the mortgage in order to borrow against the value of the house. In both situations the borrower retains the house, but the lender has the right to take possession if the borrower does not service the debt. Hypothecation also occurs in trading: a broker will allow an investor to borrow money to purchase securities with those securities as collateral. The investor owns the securities but the broker may take them if the debt is not serviced, or if the value of the securities falls below a certain level. See also: Foreclosure, Margin account.

Pledged Asset

An asset that a borrower transfers to the possession of a lender as collateral for a loan. The borrower maintains ownership and all associated rights of the pledged asset. When the loan is repaid, the lender transfers possession back to the borrower. The pledged asset reduces the risk to the lender that the borrower will default, therefore possibly qualifying the borrower for some benefit, such as a lower interest rate. When buying a house, some mortgage borrowers will pledge an asset, such as stock, to the lender to qualify for a lower down payment. See also: Secured loan.
References in periodicals archive ?
1, 2015 /PRNewswire/ --#GivingTuesday -- Pledge 1%, a corporate philanthropy movement founded by Atlassian, Entrepreneurs Foundation of Colorado, Rally for Impact and Salesforce.
Some of the richest people in the United States have joined The Giving Pledge started by Bill Gates and wife Melinda, and Warren Buffett in 2010.
Virginity pledges appear to reduce the risk of sexual initiation even when differences in young people's propensity to pledge are taken into account.
Value of pledged property: The final regulations provide that, if additional property is made subject to a pledge, it is treated as a new pledge and the net FMV of all of the pledged property must be determined at that time.
Gittler's pledge to recycle more was drawn from more than 100,000 pledges entered in the national drawing during last year's America Recycles campaign, which is celebrated yearly on Nov.
Unless they make an actual "economic outlay" under the arrangement, taxpayers generally may not increase their basis in S corporation stock as a result of a loan guarantee, pledge of stock as collateral or loss of control of the corporation.
14 resurrected the controversy over the Pledge of Allegiance, striking down public school recitation because of the phrase "one nation under God.
SAN FRANCISCO - Setting up another likely Supreme Court showdown over the Pledge of Allegiance, a federal judge ruled Wednesday that reciting the pledge in public schools is unconstitutional.
We suspect that the 13% were not lying or forgetful; rather the wording of the questionnaire did not allow them to report the real situation, that they had taken a pledge but abandoned it.
IBM believes this is the largest pledge ever of patents of any kind and represents a major shift in the way IBM manages and deploys its intellectual property (IP) portfolio.
2028, the "Pledge Protection Act of 2003," which would strip the federal courts of jurisdiction over cases involving the Pledge of Allegiance.
ITEM: On September 23, the Associated Press reported that "the House passed legislation [today] that would prevent the Supreme Court from ruling on whether the words 'under God' should be stricken from the Pledge of Allegiance.