Letter of hypothecation

Letter of hypothecation,

Definition of Letter of hypothecation:

  1. Written agreement, which authorizes a bank or lender to repossess and sell the pledged item in case of a default. In international trade, a letter of hypothecation enables an accepting bank to sell the shipment in case of the non-acceptance or non-payment of the associated bill of exchange by the buyer.

Meaning of Letter of hypothecation & Letter of hypothecation Definition