Junior debt is less secure than senior debt as it is not backed by collateral. Consumers can take on senior or junior debt, with the former being tied to tangible items like property or vehicles. In bankruptcy, senior debt holders have priority over junior debt holders. There are different types and levels of debt that […]
Christian Debt Consolidators offer debt consolidation services and budgeting advice based on Biblical principles. They may also provide guidance on time and talent management, and encourage financial support for churches. However, the quality of advice and support varies and consumers should carefully evaluate the program before committing. Christian Debt Consolidators are financial services that provide […]
The debt snowball method involves paying off the smallest debts first, then progressively working up to the largest debt, using extra cash each month. It is important to make minimum payments on all debts and avoid adding to them. Debt is money that an individual owes to a lender. Interest is generally included in amounts […]
Funded debt is long-term debt, while unfunded debt is short-term. A company’s debt can be measured through ratios that compare funded debt to capitalization or financial structure. Excess debt can limit growth and borrowing capacity. Analysts can characterize credit obligations in different ways. Funded debt represents the amount of long-term debt a company has on […]
A bad debt provision is an accounting provision that allows businesses to absorb uncollected revenue, creating a cushion to minimize the impact of uncollected debt. The amount is determined based on factors such as average accounts receivable and age of customer invoices, and is considered part of accounts receivable. It is especially important for small […]
A debt service fund is used to pay interest, principal, and other fees associated with short-term and long-term debt. It may be required for entities to assume debt obligations or part of a financial plan. Deposits must be timed carefully for full coverage. It can be used to pay off debts early to reduce overall […]
Debt negotiators can help those in financial trouble negotiate settlements with creditors, but it’s important to choose the right negotiator. Unsecured debts are good candidates for negotiation, and a lawyer or credit counseling service can assist with complex legal and tax issues. Negotiations should be done via correspondence and a debt negotiator can help determine […]
Private placement debt is generated through non-public offerings and often attracts high-profile investors. It is regulated by national agencies and can provide a steady stream of income for investors over a long period. Private placement debt is a type of debt that is generated when a bond or other security is sold in a non-public […]
Government debt consolidation can refer to governments consolidating their loans through bonds or the Federal Government offering debt consolidation for student loans. Local governments consolidate loans when interest rates are low. Government debt consolidation for student loans offers better interest rates and convenience. Government debt consolidation could mean one of two different things. A type […]
Government debt can take many forms and includes external debt owed to other countries or organizations, and domestic debt owed to individuals, businesses, and financial institutions. Short-term and long-term debt sustainability is important, and deficit spending can lead to high levels of debt that can cause economic consequences. Government debt consists of debts owed by […]
Debt forgiveness is when a lender forgives all or part of a borrower’s debt, but it is not a simple solution. Borrowers must contact the lender and demonstrate their attempts to meet debt obligations. Lenders may suggest payment plans and have requirements to be met. Borrowers should work with the lender and avoid being aggressive. […]
External debt refers to the amount of money a country owes to other countries or external banking organizations. International Financial Institutions (IFIs) specialize in loans to developing nations to improve infrastructure and economic activities. For external debt to be sustainable, a country must have a high enough GDP to pay off and eventually repay the […]
A debt relief order is a legal authorization that forgives some or all of a debtor’s debt, requiring specific claims to be filed with a court. The court has criteria that must be met, and the debtor’s financial condition is investigated. It is only issued when other alternatives are not viable, and it may negatively […]
Mezzanine debt is a loan with low credit priority on a company’s assets, resulting in higher costs for lenders. It can be provided through subordinated debt or preferred stock, but is risky and often demands higher returns. Specialist lenders offer mezzanine investment funds. Mezzanine debt is a type of loan from a public company in […]
Mortgage lenders use the mortgage debt ratio to determine if a borrower can make monthly payments. The ratio is calculated by dividing monthly income by expected mortgage payments. Other debts are also factored in to determine the payback ratio, which should not exceed 30%. Anything above 40% would likely result in a loan refusal. The […]
Bad debt buyers purchase delinquent debts at a discount and attempt to collect the full amount plus interest and penalties from the debtor. They specialize in different types of debt, including credit card debt, business debt, and loan debt, and are different from debt collection agencies as they become the new owners of the debt. […]
To obtain credit card debt forgiveness, contact the credit card company and negotiate a one-time cash payment. This is usually offered if the customer has been avoiding payment for an extended period. However, the forgiven amount is taxable and can damage your credit score. To obtain credit card debt forgiveness, you will need to contact […]
The Office of Public Debt manages the borrowing of funds for the US government, tracks government debt, and sells and manages Treasury securities. It conducts auctions and offers savings bonds through Treasury Direct. Treasury securities are considered safe investments backed by the US government. The Office of Public Debt is an agency of the United […]
The cost of debt capital refers to the interest paid on outstanding debt, including bank loans and bond options. Understanding it helps businesses manage finances, weigh potential actions against liabilities, and determine the best way to raise funding. The cost of debt capital is associated with the amount of interest paid on currently outstanding debt. […]
The Office of Public Debt manages the sale and management of Treasury securities, borrowing about $2 trillion annually. It conducts auctions and tracks total government debt, and is headquartered in Washington, DC. Treasury securities are a safe investment backed by the US government. The Office of Public Debt is an agency of the United States […]
