A collateral loan is probably the simplest form of loan, the concept of which members have been familiar with since childhood. You wanted to borrow your friend's bike, you let them use your baseball glove in the meantime.
Same thing here. When you need funds but don't have (or don't want) to deplete your savings, simply put up collateral and secure a loan, such as a car, motorcycle, boat, and so on. Unlike the childhood scenario, though, you still keep and use the collateral. So we kind of get the short end of the stick here.