Assignee & Assignor
What is an Assignee & an Assignor?
An assignee is a lender who receives an asset as collateral for a loan.
An assignor is the company who pledges the collateral.
How it Works
A company may want to borrow money via a loan.
The lender wants to be as confident as possible the loan is secure—ie they will get their money back.
To achieve this, the lender will ask for some kind of collateral—fixed assets or accounts receivable.
Here, the borrower is referred to as the assignor.
They are pledging collateral.
The lender is referred to as the assignee.
They are the one to whom the collateral is pledged.
© R.J. Hickman 2020