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Interesting facts

  • Upside-Down, also known as negative equity, refers to owing more on a loan than the value of the asset for which the loan was used to purchase. Upside-down loans occur when the asset depreciates in value, or was overvalued when the buyer purchased the asset.
    For instance, given that most cars rapidly depreciate in value, it follows that...
  • In corporate finance, Structural subordination refers to the concept that a lender to a company will not have access to the assets of the company's subsidiary until after all of the subsidiary's creditors have been paid and the remaining assets have been distributed up to the company as an equity holder. For example, if a lender loans money to...