Nonrecourse


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Nonrecourse

In the case of default, the lender has no ability to claim assets over and above what the limited partners contributed.

Non-Recourse Finance

A loan secured by the revenue of the project the loan intends to fund, and nothing else. That is, non-recourse finance does not allow the bank or other lending institution access to the borrower's other assets in the event of default. This is a relatively high-risk form of financing; projects that utilize non-recourse finance generally have uncertain revenue streams and long loan periods.
References in periodicals archive ?
Pursuant to the alert, FCMs are not allowed to have limited recourse and nonrecourse clauses in any agreements with their customers and noncustomers.
At-risk basis is the cumulative result of a taxpayer's (1) contributions and distributions of cash and property by or to the taxpayer; (2) borrowings to the extent the taxpayer is liable for repayment or has pledged property, other than property used in the activity, as security for the borrowed amounts (recourse debts); (3) certain borrowings in connection with an activity of holding real property if no person is liable for repayment (qualified nonrecourse debts); and (4) the excess of passthrough items of income over deductions from the activity (Sec.
Ready Capital closed an $8.2 million, nonrecourse, interest only, floating rate loan that features a 36-month term, with two 12-month extension options, flexible pre-payment, and is inclusive of a facility to provide future funding for capital expenditures, working capital, leasing costs, and interest and operating reserves.
Nonrecourse debt is a popular financing mechanism for larger, market-rate apartment developments in desirable areas, like the North Loop's Borealis, a 124-unit project by Solhem Cos.
Chicago Loan Co writes nonrecourse loans from its secure upper story office in downtown's Jewelers Row.
The notes did not contain express language stating whether they were recourse or nonrecourse to the taxpayer.
The joint venture is to concentrate on facilitating and structuring nonrecourse financing for solar PV plants in the country.
Of this amount, 75 percent is expected to be funded by nonrecourse financing while the remaining 25 percent will be funded by equity.
More than 84% of the financing for the Nettuno solar park has been secured via an 18-year nonrecourse loan.
As discussed below, on her 1938 federal income tax return, Beulah reported the transaction as the sale of a nondepreciable equity interest in the Brooklyn Apartment Building with a zero basis, rather than the physical property itself in exchange for $2,500 (not treating the nonrecourse debt relief as an economic benefit).
If one or more partners or related persons guarantee the payment of more than 25% of the interest that will accrue on a partnership nonrecourse liability over its remaining term and it is reasonable to expect that the guarantor will be required to pay substantially all of the guaranteed interest if the partnership fails to do so, the loan will be deemed to be recourse with respect to the guarantor to the extent of the present value of the future interest payments.
This example takes into account the income tax considerations if the employee loan is either a nonrecourse loan (i.e., if Executive has no personal liability for the loan) or a recourse loan (i.e., if Executive has personal liability for the loan).