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Commercial mortgages often contain lockout provisions (typically a period of 1–5 years [2] where there can be no prepayment of the loan) which they can be subject to defeasance, yield maintenance and prepayment penalties to protect bondholders. European CMBS issues typically have less prepayment protection.
An acceleration clause is a section of a mortgage contract that can have big consequences: Namely, it can require you to pay off your entire mortgage at once. Even if you miss only one payment.
The solution was to merge the latter-day wadset and gage for years into a single transaction embodied in two instruments: (1) the absolute conveyance (the charter) in fee or for years to the lender; (2) an indenture or bond (the defeasance) reciting the loan and providing that if it was repaid the land would reinvest in the borrower, but if not ...
A mortgage loan has two parts: The promissory note.This is the financing instrument that acts as evidence of the debt. It’s a written promise or agreement to repay the debt in installments with ...
Defeasance (or defeazance) (French: défaire, to undo), in law, is an instrument which defeats the force or operation of some other deed or estate; as distinguished from condition, that which in the same deed is called a condition is a defeasance in another deed. [1] The term is used in several contexts in finance, including: [2]
The statement explained that a bond defeasance is a process that sets aside and invests the remaining bond dollars in escrow to ensure that the principal and interest payments on the bonds are ...
A commercial mortgage is a mortgage loan secured by commercial property, such as an office building, shopping center, industrial warehouse, or apartment complex.The proceeds from a commercial mortgage are typically used to acquire, refinance, or redevelop commercial property.
Current Yield – But now consider how yield changes if the price of that same bond falls. If the bond mentioned above is resold for $800 it results in a current yield of 6.25%.