Skip to content

Pledging a Jointly Owned CD as Collateral

Answered by: 

Question: 
When a Joint CD is used as a collateral on a loan must both parties pledge the collateral or is the one borrowing the money the only one necessary? If a loan is secured by a CD the has a POD on it must the POD pledge the collateral also for the loan?
Answer: 

I can answer part of this. If either of those "or" owners could close that account, they generally have the ability to pledge that asset.

But check your state laws. Texas, as an example, just passed a law clearly allowing the pledge this way but requires a notice to be sent to the co-owner advising them of the pledge.

First published on BankersOnline.com 11/17/03

First published on 11/17/2003

Filed under: 
Filed under lending as: 

Banker Store View All

From training, policies, forms, and publications, to office products and occasional gifts, it’s available here:

Banker Store

hot right now

image description

Looking for effective, convenient training on a particular subject?

BOL Learning Connect offers more than 200 courses ON-DEMAND or on CD ROM from AML to Reg Z and every topic in between.

Search Topics