The borrower is the party who borrows the funds. The lender is the one who lends the money in return for a security interest. The lender can repossess the asset if the borrower fails to repay the loan. The lender can then sell the asset to repay the loan. A loan secured by collateral is called a "secured loan" (also called a lien). A loan with no collateral (such as a credit card) is an unsecured loan. There is nothing for the lender to repossess.