What are senior secured second lien notes?

Second Lien Senior Secured Debt means Debt of the Credit Parties secured by Liens on the Collateral on a junior basis pursuant to intercreditor arrangements, which shall contain customary market terms and conditions for second lien financings and otherwise be in form and substance reasonably satisfactory to the …

What is second lien senior secured loans?

Second lien lending refers to loans where a creditor’s claims are subordinated to those of the creditors who hold senior debt. Senior lien holders might receive 100% of the loan balance if the collateral on the loan is sold or they might only receive a fraction of the total amount of the loan.

What are second lien notes?

Second-lien debt refers to loans that are prioritized lower than other, higher-ranked debt in the event of bankruptcy and liquidation of assets. Other names for second-lien debt include junior debt and subordinated debt.

How do 2nd liens work?

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.

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Are second lien term loans secured?

The vast majority of all second lien loans are senior secured obligations of the borrower. Second lien loans differ from both unsecured debt and subordinated debt.

What is a senior secured note?

Senior Secured Notes means secured or unsecured notes or other debt of the Company issued after the Closing Date, and the Indebtedness represented thereby; provided that (a) the terms of which do not provide for any scheduled repayment, mandatory redemption or sinking fund obligations prior to the Latest Maturity Date …

Are senior secured notes first lien?

Senior debt is often secured by collateral on which the lender has put in place a first lien. Usually this covers all the assets of a corporation and is often used for revolving credit lines. It is the debt that has priority for repayment in a liquidation.

What is the difference between 1st and 2nd lien?

A second lien is a loan taken out that uses your home as collateral, even though you already have a mortgage that is secured by the property. It comes second to the first lien, which is the initial mortgage you took out to purchase the home.

Are bonds senior debt?

Loans and bonds can be issued as senior debt or subordinated debt. Senior debt is repaid first if the borrower encounters a default or liquidation. It is usually secured debt with collateral; however, it can also be unsecured with specific provisions for repayment seniority.

Is a second mortgage secured or unsecured debt?

Second mortgage loans include home equity loans and lines of credit. All of these loans are secured by your home. Failure to make payments on either a first or second mortgage or home equity financing can trigger foreclosure.

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Does second lien debt amortize?

Second lien debt is generally considered riskier than senior debt but less risky than junior debt. … Second-lien loans may feature bullet payments or very limited amortisation provisions.

Is mezzanine debt second lien?

Unlike second-lien loans, mezzanine debt is a true ‘silent second’ debt behind the senior loan. Second-lien or tranche B loans(1) emerged in the early years of this decade. The growth in second-lien loans corresponds to a dramatic expansion of private equity funds and buy-out transactions in the past five years.

What type of lien takes priority over all other liens?

Mortgage liens usually take priority over any other lien except tax liens.

What does senior unsecured debt mean?

Senior Unsecured Debt means indebtedness for borrowed money that is not subordinated to any other indebtedness for borrowed money and is not secured or supported by a guarantee, letter of credit or other form of credit enhancement.

What is a second lien bond?

Second Lien Bond means a debt security (that is not a loan) that is issued by a corporation, limited liability company, partnership or trust and secured by a valid second priority perfected security interest or specified collateral.

Is a second mortgage the same as a second lien?

When you take out a home equity loan, your second mortgage provider gives you a percentage of your equity in cash. In exchange, the lender gets a second lien on your property. You pay the loan back in monthly installments with interest, just like your original mortgage.