Bond concepts

a. Indenture the formal agreement between lender and buyer specifying the terms of the loan and the relationship of the parties.

b. Trustee a third party who represents the interests of the lender(s) to the borrower.

c. Mortgage a legal agreement between borrower and lender, distinct from but accompanying the loan agreement, which specifies the loan collateral.

d. Debenture a bond without collateral.

e. Sinking fund an account set up by the borrower into which the borrower regularly deposits money to repay the loan.

f. Serial bond a bond carrying a serial number which permits it to be specifically identified and (possibly) retired prior to its maturity date.

Be the first to comment on "Bond concepts"

Leave a comment

Your email address will not be published.


This site uses Akismet to reduce spam. Learn how your comment data is processed.