What Is the Loan Life Coverage Ratio (LLCR)? The loan life coverage ratio (LLCR) is a financial ratio used to estimate the solvency of a firm, or the ability of a borrowing company to repay an outstanding loan. LLCR is calculated by dividing the net present value (NPV) of the money available for debt repayment by
What Is Lloyd’s of London? Lloyd’s of London, often referred to today simply as Lloyd’s, is an insurance and reinsurance marketplace. Its members operate as syndicates to provide insurance coverage for businesses, organizations, and individuals. The syndicates specialize in different types of risks and each syndicate decides which risks to insure. The main purpose of
What Is a Load-Adjusted Return? A load-adjusted return is the investment return on a mutual fund that has been adjusted for the fund’s sales loads and specific other charges, such as 12b-1 fees. Loads, or fees charged by some mutual funds for marketing or buying and selling shares, are like all other investment fees in
What Is a Load Spread Option? A load spread option is a method of collecting the annual fees from investors in load funds through periodic deductions. The idea is somewhat similar to a spread-load contractual plan. The investor can always opt to pay the fees in one lump sum. However, the load spread option provides
What Is a Loan? The term loan refers to a type of credit vehicle in which a sum of money is lent to another party in exchange for future repayment of the value or principal amount. In many cases, the lender also adds interest or finance charges to the principal value which the borrower must
What is Loan Modification? Loan modification is a change made to the terms of an existing loan by a lender. It may involve a reduction in the interest rate, an extension of the length of time for repayment, a different type of loan, or any combination of the three. Such changes usually are made because
What Is Loan Servicing? Loan servicing refers to the administrative aspects of a loan from the time the proceeds are dispersed to the borrower until the loan is paid off. Loan servicing includes sending monthly payment statements, collecting monthly payments, maintaining records of payments and balances, collecting and paying taxes and insurance (and managing escrow funds)
What Is Loan Stock? Loan stock refers to shares of common or preferred stock that are used as collateral to secure a loan from another party. The loan earns a fixed interest rate, much like a standard loan, and can be secured or unsecured. A secured loan stock may also be called a convertible loan
What Is a Loan Application Fee? A loan application fee is charged to a potential borrower for processing and underwriting an application for a loan, such as a mortgage or car loan. Loan application fees may be required for all types of loans and are intended to pay for the costs of the process of
What Is a Loan Commitment? A loan commitment is an agreement by a commercial bank or other financial institution to lend a business or individual a specified sum of money. A loan commitment is useful for consumers looking to buy a home or a business planning to make a major purchase. The loan can take
