What are senior and junior bonds?
A senior bond is a type of debt security that has a superior claim on the assets and income of the entity that issues the bond. Bonds that have secondary claim on the issuer’s assets are classed as junior bonds. Those with the strongest claim on those same assets are referred to as being senior bond issues.
What is junior and senior debt?
Subordinated debt, or junior debt, is less of a priority than senior debt in terms of repayments. Senior debt is often secured and is more likely to be paid back while subordinated debt is not secured and is more of a risk.
What does junior capital mean?
Junior capital defines any non-senior type of debt capital. These would include mezzanine debt or equity. Junior status indicates it is at the risk capital level and that it is generally not secured by assets. This means that the provider is at a risk capital layer in the capital structure.
What is a junior security?
The term junior security refers to a security with a lower priority than others. Put simply, a junior security is subordinate to any other type of security. This means that junior security holders get paid only after those who own senior securities if and when a company goes bankrupt or is liquidated.
What is considered a junior loan?
A junior mortgage is a home loan made in addition to the property’s primary mortgage. Home equity loans and HELOCs are often used as second mortgages. Junior mortgages often carry higher interest rates and lower loan amounts, and may be subject to additional restrictions and limitations.
What are junior loans?
A second mortgage or junior-lien is a loan you take out using your house as collateral while you still have another loan secured by your house. The term “second” means that if you can no longer pay your mortgages and your home is sold to pay off the debts, this loan is paid off second.
Is there junior secured debt?
Junior Secured Debt means Indebtedness of the Borrower or any Guarantor that is secured by a Lien on all or any portion of the Collateral (but not any assets that do not constitute Collateral) that is junior to the Lien in favor of the Collateral Agent on the Collateral.
What is a junior or subordinated bond?
Junior or subordinated bonds are named specifically for their position in the payout order: Their junior, or subordinate, status means they only are paid out after senior bonds, in the event of a default.
What is Junior funding?
Junior Financing means any Indebtedness (other than any permitted intercompany Indebtedness owing to Holdings, the Borrower or any Restricted Subsidiary) that is contractually subordinated in right of payment to the Loan Document Obligations.
What does junior claim mean?
Junior Claims means any Indebtedness or securities of the Company or any of its Subsidiaries of any class junior in rank to the Notes and the Additional Notes in respect of the preferences as to distributions and payments upon a Liquidation Event, including, without limitation, any Equity Securities of the Company or …
Which is the most junior security?
capital note
In structured finance, the capital note is the most junior security issued by a structured investment vehicle. It is comparable to the equity tranche of a CDO.
What is a junior deed of trust?
A bank takes a junior deed of trust when you borrow against your home’s equity, or the difference between what you could sell your home for and what you owe on it. Home equity loans can help you pay for home repairs and improvements and pay off credit cards.