Which term describes the security provided to the lender, which may include guarantees from outside parties?

The term that describes the security provided to the lender, which may include guarantees from outside parties, is collateral. In the context of mortgage lending, collateral refers to the physical asset (such as a home or property) or additional guarantees that a borrower offers to secure the loan. This security gives the lender a claim on the asset in case the borrower defaults on the loan, thereby reducing the lender's risk.

Collateral can take various forms, including the property itself and other assets, and may even involve guarantees from third parties who may pledge their own assets or creditworthiness to support the borrower's loan request. This layer of security is crucial in lending transactions, as it assures lenders that they have recourse should the borrower fail to meet their repayment obligations. Understanding this concept is vital for anyone involved in mortgage transactions, as it underpins the foundation of loan security in real estate financing.