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Default Risk |
Also found in: Wikipedia | 0.04 sec. |
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Default risk The risk that an issuer of a bond may be unable to make timely principal and interest payments. Also referred to as credit risk (as gauged by commercial rating companies).
Default Risk The risk that a debtor will be unable to pay back its loans. Default risk goes up if a debtor has large number of liabilities and poor cash flow. Generally speaking, companies and persons with high default risk stand a greater chance of a loan being denied and pay a higher interest rate on the loans they do receive. See also: Bankruptcy. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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| Indymac Bank has promoted Alex Cole to vice president of business development for the home construction lending division and Carla Wise to senior vice president of default risk management. Mortgage lenders in California are more critically scrutinizing loan applications now because of higher default risk resulting from a shift in sales patterns as the real estate market nears the end of its boom cycle, an industry tracker said Monday. Both the stochastic interest rate and the stochastic default risk are modeled as a square-root diffusion process. |
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