Asset based lending refers to loans secured by a wide variety of assets.
Businesses can borrow money using the liquid, current assets of the company (such as accounts receivable and/or inventory)
or the fixed assets of a business (such as plant, property, and equipment) as collateral. Asset based lenders rely on the value of
the underlying collateral to minimize the loan's credit risk. Asset based loans also can include equipment loans and real estate mortgages.
Commercial finance is the term most commonly affiliated with the industry group of lenders that provides all types of asset based loans to
business and commercial borrowers. Asset based lenders are sometimes referred to as secured lenders.
