Collateral describes the assets you pledge in order to receive a business loan. Collateral may include business or personal assets, such as the equity in your home or car. If you have collateral, you can get a "secured" loan at better rates than if you had no collateral. One of the reasons it is more difficult to receive a loan for a startup is that there are not yet any business assets which can be used as collateral.
Collateral
By Jean Murray, About.com
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