Claim dilution

Claim dilution

A decrease in the likelihood that one or more of a firm's claimants will be fully repaid, including time value of money considerations.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Claim Dilution

A situation in which it becomes less likely that a party to a loan, security, or other contract will be paid in full as agreed. It can occur in mortgage-backed securities, for example, if more securities are issued without a proportionate number of new mortgages being bought and incorporated into the security. See also: Anti-dilution provision.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved