👉 In the context of finance, "praefloration" refers to a situation in which a borrower or lender has agreed to extend additional credit to another party. This is usually done in order to secure a higher interest rate for the original loan. For example, if a borrower borrows $500 from an investor who agrees to lend them $700, the investor can then use this additional $200 as collateral to secure their own loan of $1200.
