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.

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.

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