Financial Dictionary

This dictionary contains:
24549
financial terms

Negative equity




Negative equity

A situation where the purchaser of a property has taken out a mortgage and some time after the purchase, the value of the property falls below the mortgage amount.

RELATED TERMS
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Property
A legally owned possession or real estate.

Mortgage
A loan, usually to buy property, which serves as security for the loan; to take out a loan with a property as security.

Purchase
Buy; be long; have an ownership position.

Value
The worth or desirability of something expressed as an amount of money.



SIMILAR TERMS
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Negative amortization
A loan repayment schedule in which the outstanding principal balance of the loan increases, rather than amortizing, because the scheduled monthly payments do not cover the full amount required to amortize the loan.

Negative carry
A situation in which the cost of financing a securities or financial futures position exceeds the yield earned.

Negative cash flow
Occurs when spending in a business is greater than earnings.

Negative convexity
A bond characteristic such that the price appreciation will be less than the price depreciation for a large change in yield of a given number of basis points.

Negative covenant
A bond covenant that limits or prohibits certain actions unless the bondholders agree.

Negative duration
Occurs when the price of an MBS moves in the same direction as interest rates.

Negative goodwill
A gain occurring when the price paid for an acquisition is less than the fair value of its net assets.

Negative income tax
A proposal to assist taxpayer with below-subsistence-level incomes. After filing a tax return, such persons would receive a subsidy to bring them up above the poverty level.

Negative NPV tie-in project
A negative-NPV infrastructure development project that a local government requires of a company engaged in a positive NPV investment project elsewhere in the country.

Negative obligation
A New York Stock Exchange rule that governs the behavior of specialists. Negative obligation is the mandate of the specialists not trade for the specialist's firm's own account when enough public investor orders exist to match up naturally, without intervention.

Negative pledge
An agreement in which the borrower agrees not to pledge any of its assets as security and-or not to incur further indebtedness.

Negative pledge clause
A bond covenant that requires the borrower to grant lenders a lien equivalent to any liens that may be granted in the future to any other currently unsecured lenders.

Negative volume index
An index that focuses on days where the volume has significantly decreased from the previous day's trading.

Negative working capital
Occurs when current liabilities exceed current assets, which can lead to bankruptcy.

Negative yield curve
Arises when short-term interest rates are higher than long-term ones.



PREVIOUS AND NEXT TERMS
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Negative carry
A situation in which the cost of financing a securities or financial futures position exceeds the yield earned.

Negative cash flow
Occurs when spending in a business is greater than earnings.

Negative convexity
A bond characteristic such that the price appreciation will be less than the price depreciation for a large change in yield of a given number of basis points.

Negative covenant
A bond covenant that limits or prohibits certain actions unless the bondholders agree.

Negative duration
Occurs when the price of an MBS moves in the same direction as interest rates.

Negative equity

Negative goodwill
A gain occurring when the price paid for an acquisition is less than the fair value of its net assets.

Negative income tax
A proposal to assist taxpayer with below-subsistence-level incomes. After filing a tax return, such persons would receive a subsidy to bring them up above the poverty level.

Negative NPV tie-in project
A negative-NPV infrastructure development project that a local government requires of a company engaged in a positive NPV investment project elsewhere in the country.

Negative obligation
A New York Stock Exchange rule that governs the behavior of specialists. Negative obligation is the mandate of the specialists not trade for the specialist's firm's own account when enough public investor orders exist to match up naturally, without intervention.

Negative pledge
An agreement in which the borrower agrees not to pledge any of its assets as security and-or not to incur further indebtedness.

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This dictionary contains 24549 terms.







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