how much can a broker rehypothecate 
in the united states the securities and exchange commission restricts rehypothecation to 140 percent of the loan amount for example if collateral of 300 is used to take out a loan for 100 140 may be rehypothecated as was seen in the mf global bankruptcy there are no rehypothecation limits in some other countries the bottom linerehypothecation is the practice where banks brokers or individuals use collateral that they do not own to help finance assets previously pledged collateral is used as collateral for a new loan creating a leveraging cycle that promotes profitability but increases default risk consumers can avoid rehypothecation by avoiding margin accounts and restricting those who hold their collateral by using it in certain ways 