That is 'B-note' | Information 2019 - What is it?
The B-note - secondary part in commercial the maintained safety mortgage. Payments of the borrower on the mortgages containing in the securitized product are used to make payments to holders of safety of the B-note. B-notes - a component of financing of A/B or financing of A/B/C. When mortgage payments are collected, to carriers of B-notes pay bearing A-notes. It forces B-notes to bear more risk. B-notes make bigger payment to the investor, than the comparable A-note to give compensation to the investor for this additional risk. To the B-note also appoint lower credit rating, than the corresponding class the note. Carriers of B-notes are paid before investors of hundred dollar notes, thus, they bear less risk, than hundred dollar notes and have higher credit rating, than notes of a class C. The financed property serves as property pledge for the B-note eventually, the borrower doesn't pay the planned payments on the credit.
The B-note is also known as "the note of a class B".
2019 - B-note
B-note, Information - 2019
DESTRUCTION of 'B-note' | Information 2019 - What is it?
So far the borrower pays a mortgage loan in time (in other words while the loan acts), investors in all parts will receive the corresponding shares of payments of the borrower at the same time. However, if non-payments of the borrower, holders of a class of the note are paid their percent and the main payments before holders of notes of a class B.
In the same way holders of B-notes of a class are paid before holders of notes of a class C. The interest rate and estimating reflects this risk level in notes of a class B. Alternatives to the note A/B or financing of the note A/B/C include the preferred action, a debt of the dress circle and the second mortgages, all from which are forms of the secondary financing used in addition to the first mortgage.
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