What does a secured deal mean? What are the securities for real estate investments?

A secured deal means that the repayment risks are in part mitigated by the creation of security interests over certain assets. In real estate financing, the common types of securities include mortgage over the property, assignment of current and future income and charge over a bank account. Where the deal is a mezzanine debt, security may rank second to senior lenders which are typically financial institutions.

In case of a default in repayment by the ultimate borrower, these securities can be enforced so that the asset value can be materialised into cash and redistributed back to the investors.

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