Bullet Repayment

Bullet Repayment

1. A way to structure the repayment of a loan in which the borrower does not pay the principal over the life of the loan, but rather makes a lump sum payment at maturity. This is relatively common in mortgage loans; the borrower pays the interest each month and refinances the house in order to make the bullet repayment at the end of the mortgage term.

2. The lump sum payment in a bullet repayment structure.
References in periodicals archive ?
The planned Bond is anticipated to have a 5-year tenor, be redeemable after 2.5 years (with a market standard call premium) and have a bullet repayment structure, which will allow for Phase 2 capex with a strong cash buffer at maturity.
Earlier, UPL Corporation had raised a three billion dollar (about Rs 20 crore) five-year unsecured term loan with a bullet repayment at end of tenure at London Inter-bank Offered Rate (LIBOR) plus 160 basis point per annum to part-finance the acquisition of Arysta Lifescience Inc.
The ICP-2 will have bullet repayment at maturity and a tenor of 6 months.
Doha Bank said the facility will be used for general working capital purposes, and carries a margin of 100 basis points per annum over USD Libor and has a bullet repayment at the end of the two-year tenor (with a further one-year extension option exercisable at the discretion of lenders).
The facility, which will be used for general working capital purposes, carries a margin of 100 basis points per annum over the dollar-denominated Libor (London Interbank Offered Rate) and has a bullet repayment at the end of the two-year tenor (with a further one-year extension option exercisable at the discretion of lenders).
The bonds are backed by the full faith and credit of the Nigerian Government, with interest payable semi-annually to bondholders, while bullet repayment will be made on the maturity date.
In a footnote, the bank noted that these were medium-term loans from China that were meant for balance of payments support with an inbuilt bullet repayment feature, a maturity of two to three years and a floating rate based on the London Inter-bank Offered Rate (Libor).
For example, take a five-year loan with bullet repayment, what is the difference between bank X and bank Y?
The long-term tranche also includes a bullet repayment feature at the end of the 39 year term.
Being mostly short-term loans, gold loans are usually paid back in one shot - interest and principal together - at the end of the loan term (what is called 'bullet repayment').
For example, large annual amortisation payments will restrict cash available for reinvestment into growth or acquisitions, so a bullet repayment structure is more likely to be appropriate.