Limited recourse

(redirected from Limited Recourse Finance)

Limited recourse

A term describing a type of loan in which the lender has limited or no claim against the parent company if the collateral is insufficient to repay the debt. See:Nonrecourse.

Limited Recourse

Describing a loan that is secured up to a certain amount. For example, a loan on which one-third of the principal is secured or collateralized is a limited recourse loan. These loans may be used in project finance; a company may issue a bond with limited recourse for the first five years of its life, after which it becomes fully secured. Limited recourse loans carry lower interest rates than without recourse loans. In the event of liquidation, limited recourse debt is paid after secured debt and before unsecured debt.
References in periodicals archive ?
The rapidly increasing price of EPC contracts from 2007 because of spiraling input costs and the limited pool of eligible contractors has been compounded more recently by the increasing price and limited availability of limited recourse finance.
It will also have access to up to A$9 million in limited recourse finance through QNI for the development of an integrated project which was negotiated as part of the first stage of rationalization announced last year", Mr Bailey said.
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