In this case protection is a buyback obligation which is provided by a loan originator. A buyback obligation is a credit enhancement given by the lending company or other entity of a lending company group to the investor for a particular loan. If the loan is more than 60 days late, the lending company is obligated to buy back the investment at nominal value plus accrued interest. Usually, this means investors will be able to recover their investment in case of a borrower default.
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What protection do I have in case of non-repayment?
Articles in this category
- What are the types of covenants and securities provided by a broker on Debitum?
- Is Debitum a regulated platform?
- Can I delete my account?
- I cannot access my account because of the two-factor-authentication (2FA) issue. What do I do?
- What kinds of collateral are used to secure the loans?
- What protection do I have in case of non-repayment?
- What are the guarantees of an investment via Debitum?
- What is the "under asset"?
- What is the Buyback Obligation?
- What happens if a Loan Originator goes bankrupt? See more