- A secured loan that is backed by collateral, often real property. The borrower of nonrecourse debt is not personally liable for the debt. In other words, if the borrower defaults on his or her loan, the lender can collect the collateral, but the borrower is not responsible for the remaining balance. Also known as "non-recourse debt" or a "non-recourse loan."
secured loan, nonrecourse debt, secured debt
Related Terms and Acronyms
- Borrower — Definition,
- A person who borrows money or obtains a loan.
- Collateral — Definition,
- Any property pledged as security for repayment of a debt.
- Commercial Mortgage — Definition, Very Important,
- A mortgage for commercial property.
- Default — Definition,
- When a borrower fails to fulfill the obligations of a loan or lease.
- Lender — Definition,
- The bank or mortgage company offering the loan.
- Liability — Definition,
- A situation where one party is found to be legally responsible for something.
- Loan — Definition,
- Letting another party use something of value temporarily.
- Policy Loan — Definition,
- A loan where a life insurance policyholder's death benefit is used as collateral.
- Real Property — Definition,
- Permanent, non-movable property, such as land and buildings.
- Secured Loan — Definition,
- Borrowed money that is backed by collateral.
- Unsecured Loan — Definition,
- An advance of money that is not secured by collateral.