Common Interest Subdivision: A subdivision in which the owners own or lease a separate lot or unit together with an undivided interest in the common areas of the subdivision.

 

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Common Interest Subdivision: A subdivision in which the owners own or lease a separate lot or unit together with an undivided interest in the common areas of the subdivision.

Interest Subsidy: The value of a firm's deduction of the interest payments on its debt from its earnings before calculation of its tax bill under current tax law.

Interest Tax Shield: The reduction in income taxes that results from the tax-deductibility of interest payments.

Interest Rate Swap: A binding agreement between counterparties to exchange periodic interest payments on some predetermined dollar principal, which is called the notional principal amount. For example, one part . . . View Full Definition

Interest Rate Risk: The chance that a security's value will change due to a change in interest rates. For example, a bond's price drops as interest rates rise. For a depository institution, also called funding . . . View Full Definition

Interest Rate Futures Contract: An interest rate agreement in which payments are made when the reference rate falls below the strike rate. Related: Interest rate cap.

Interest Rate On Debt: A futures contract based on an interbank deposit rate or an underlying debt security. The value of the contract rises and falls inversely to changes in interest rates.

Interest Rate Parity Theorem: Expression that the interest rate differential between two countries is equal to the difference between the forward foreign exchange rate and the spot rate.

Interest-Only: A term loan calling for payments of interest only, not to include any amount for principal.

Interest-Only Loan: A loan in which payment of principal is deferred and interest payments are the only current obligation.