Related Words

Senior Debt: Debt that must be repaid before subordinated debt receives any payment in the event of default.

Subordinated Debt: Subordinated debt generally refers to debt securities that have a secondary or lesser claim to the issuer’s assets than more senior debt, should the issuer default on its obligations. In fac . . . View Full Definition

Junior Debt (Subordinate Debt): Debt whose holders have a claim on the firm's assets only after senior debtholder's claims have been satisfied. Subordinated debt.

Subordinated Debt (Junior Debt): Debt over which senior debt takes priority. In the event of bankruptcy, subordinated debt-holders receive payment only after senior debt is paid in full. A subordination of security interest . . . View Full Definition

Seniority: The order of repayment. In the event of bankruptcy, senior debt must be repaid before subordinated debt is repaid.

Fair Debt Collection Practices Act (1978): Federal law that prohibits debt collectors from engaging in unfair, deceptive, or abusive practices when collecting debts. Collectors must send a written notice telling the amount owed and n . . . View Full Definition

Long-Term Debt-To-Equity Ratio: A capitalization ratio comparing long-term debt to shareholders' equity.

Long-Term Debt-Capitalization: Indicator of financial leverage. Shows long-term debt as a proportion of the capital available. Determined by dividing long-term debt by the sum of long-term debt, preferred stock and common . . . View Full Definition

Monetize The Debt: Financing the national debt by printing new money, which causes inflation as a result of a larger money supply.

National Debt: The total debt accumulated by a government through the issue of government bonds, Treasury bills and Treasury notes. The government has to pay interest on its borrowings, and this obligation . . . View Full Definition