arrearage

Arrearage

An amount on a loan, cumulative preferred stock, or any credit instrument that is overdue.

Also referred to as "Arrears."

Notes:

In the case of a preferred dividend, if the dividend is not paid for any reason, it cumulates, meaning, in the future, arrearages must be paid before any dividend can be paid on common stock.

See also: Common Stock, Cumulative Dividend, Default, Preferred Stock

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Arrearage

In the context of investments, refers to the amount by which interest on bonds or dividends on cumulative preferred stock is due and unpaid.

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arrearage

An overdue payment. See also dividends in arrears.