Non Performing Loan
A loan in or near default. According to the International Monetary Fund, a non-performing loan is any loan in which: interest and principal payments are more than 90 days overdue; or more than 90 days' worth of interest has been refinanced, capitalized, or delayed by agreement; or payments are less than 90 days overdue but are no longer anticipated. Another definition of a non-performing loan is one in which the maturity date has passed but at least part of the loan is still outstanding. The specific definition is dependent upon the loan's particular terms.
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Under banking regulations, a loan that is more than 90 days past due, that has been placed on nonaccrual,or that is current on its payments but being handled as a workout.
The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.