verb
- pledges property as security for a debt without giving up possession of it
Usage: legal; finance
Examples
- The bank hypothecates the borrower’s house as collateral for the loan.
- She hypothecates her investment portfolio to secure additional credit.
- The company hypothecates its inventory to obtain working capital.
- Maritime law allows a ship captain to hypothecate the cargo in emergencies.
- The farmer hypothecates his crop yield to finance the planting season.
- Banks commonly hypothecate securities when lending money to investors.