Defeasance definition: Copy, customize, and use instantly
Introduction
The term "Defeasance" refers to a legal or financial process in which an obligation, such as a loan or bond, is rendered null and void upon the fulfillment of certain conditions or the substitution of alternative collateral. Defeasance is often used to manage debt, secure obligations, or terminate liabilities.
Below are various examples of how "Defeasance" can be defined in different contexts. Copy the one that fits your needs, customize it, and use it in your contract.
Definition of "Defeasance" as a loan repayment mechanism
This definition ties "Defeasance" to loan obligations.
"Defeasance" means the process by which a loan or debt obligation is rendered void through repayment, substitution of collateral, or satisfaction of contractual conditions.
Definition of "Defeasance" as a bond discharge process
This definition focuses on bond obligations.
"Defeasance" refers to the termination of a bond issuer’s obligations by substituting cash or securities in a trust to cover future payments of principal and interest.
Definition of "Defeasance" as a collateral substitution process
This definition highlights collateral-based "Defeasance."
"Defeasance" means the substitution of collateral or assets to release the original debtor from an obligation, ensuring the creditor’s rights are fully secured.
Definition of "Defeasance" as a termination of debt obligations
This definition emphasizes "Defeasance" for debt termination.
"Defeasance" refers to the legal termination of debt obligations upon the satisfaction of pre-specified conditions or the provision of alternative security arrangements.
Definition of "Defeasance" as a financial restructuring tool
This definition ties "Defeasance" to financial restructuring.
"Defeasance" means a financial mechanism used to restructure debt obligations by setting aside funds or assets to meet future payment requirements.
Definition of "Defeasance" as a mortgage prepayment strategy
This definition focuses on mortgages.
"Defeasance" refers to the prepayment of a mortgage loan by replacing the outstanding balance with securities or cash that fulfill the lender’s payment terms.
Definition of "Defeasance" as a release from contractual obligations
This definition emphasizes contractual "Defeasance."
"Defeasance" means the process by which a party is released from its contractual obligations by satisfying specific conditions outlined in the agreement.
Definition of "Defeasance" as a debt risk management tool
This definition ties "Defeasance" to risk mitigation.
"Defeasance" refers to a strategy used to mitigate debt risks by replacing liabilities with secure assets or collateral held in trust.
Definition of "Defeasance" as a trust fund-based debt discharge
This definition highlights trust fund usage.
"Defeasance" means the creation of a trust fund containing sufficient assets to cover future debt payments, effectively discharging the debtor’s obligations.
Definition of "Defeasance" as a condition-triggered release
This definition emphasizes conditional "Defeasance."
"Defeasance" refers to the nullification of an obligation when specific conditions, such as repayment or substitution of assets, are fully met.
Definition of "Defeasance" as a debt extinguishment process
This definition ties "Defeasance" to eliminating debt.
"Defeasance" means the process of extinguishing a debt obligation by transferring sufficient assets to a trustee to ensure future payments are fulfilled.
Definition of "Defeasance" as a financial guarantee mechanism
This definition focuses on providing financial assurance.
"Defeasance" refers to the process of securing a debt or obligation by placing guaranteed assets or cash in a trust to cover future liabilities.
Definition of "Defeasance" as a loan payoff strategy
This definition highlights early loan payoff.
"Defeasance" means a method used to settle a loan obligation before its maturity date by substituting cash or securities to meet payment requirements.
Definition of "Defeasance" as a municipal bond strategy
This definition ties "Defeasance" to municipal bonds.
"Defeasance" refers to the process used by municipalities to refinance or retire bonds by setting aside funds or securities to cover remaining payments.
Definition of "Defeasance" as a termination of lease obligations
This definition focuses on lease-related obligations.
"Defeasance" means the release of a lessee from its lease obligations upon satisfying agreed conditions, such as substituting collateral or payments.
Definition of "Defeasance" as a debt restructuring method
This definition emphasizes restructuring efforts.
"Defeasance" refers to a method used in financial restructuring to replace existing debt with secure assets held in a trust, ensuring payment to creditors.
Definition of "Defeasance" as a secured obligation resolution
This definition ties "Defeasance" to resolving secured obligations.
"Defeasance" means the resolution of secured obligations by transferring sufficient collateral to meet future payments, nullifying the debtor’s liability.
Definition of "Defeasance" as an escrow-based settlement
This definition highlights escrow accounts in "Defeasance."
"Defeasance" refers to the use of an escrow account containing predetermined assets to ensure the satisfaction of an obligation, effectively releasing the original party from liability.
Definition of "Defeasance" as a risk transfer mechanism
This definition ties "Defeasance" to risk management.
"Defeasance" means the transfer of financial risk from a debtor to a third party or trustee by substituting secure assets for outstanding obligations.
Definition of "Defeasance" as a mechanism for achieving liability neutrality
This definition emphasizes eliminating liability.
"Defeasance" refers to the legal and financial process of rendering an obligation neutral or void by fulfilling specific conditions or transferring substitute assets.
Definition of "Defeasance" as a mortgage-backed security strategy
This definition ties "Defeasance" to securities.
"Defeasance" means a process in which a mortgage-backed security is settled by substituting cash flows from alternative assets or government-backed securities.
Definition of "Defeasance" as a prepayment alternative
This definition focuses on alternative prepayment options.
"Defeasance" refers to a financial mechanism that allows early settlement of a debt obligation without direct prepayment, using substitute assets or securities.
Definition of "Defeasance" as a mechanism for maintaining credit ratings
This definition highlights the impact on credit ratings.
"Defeasance" means a strategy used to maintain or improve credit ratings by securing obligations with guaranteed assets or cash reserves.
Definition of "Defeasance" as a method for terminating restrictive covenants
This definition ties "Defeasance" to covenants.
"Defeasance" refers to the termination of restrictive covenants or contractual obligations upon satisfying predefined conditions or providing substitute performance.
Definition of "Defeasance" as a strategy for reducing financial exposure
This definition focuses on minimizing risk.
"Defeasance" means the process of reducing financial exposure by transferring liabilities to a secure trust or substituting assets to fulfill future obligations.
Definition of "Defeasance" as a legal discharge of obligations
This definition highlights legal discharge.
"Defeasance" refers to the legal process of discharging obligations when all conditions outlined in the agreement are fulfilled or collateral is substituted.
Definition of "Defeasance" as a mechanism for eliminating bondholder liability
This definition ties "Defeasance" to bondholders.
"Defeasance" means the elimination of liability to bondholders by setting aside funds or assets in a trust to meet all future payments.
Definition of "Defeasance" as a tool for corporate debt management
This definition focuses on corporate finance.
"Defeasance" refers to a corporate financial strategy used to manage debt obligations by replacing them with secure and guaranteed assets.
Definition of "Defeasance" as an instrument for terminating obligations under bankruptcy
This definition ties "Defeasance" to bankruptcy.
"Defeasance" means the resolution of obligations during bankruptcy proceedings by substituting collateral or fulfilling predefined financial conditions.
Definition of "Defeasance" as a refinancing alternative
This definition highlights refinancing.
"Defeasance" refers to a financial alternative to refinancing, allowing obligations to be settled or replaced with guaranteed assets.
Definition of "Defeasance" as a financial tool for lease buyouts
This definition ties "Defeasance" to leases.
"Defeasance" means the process of terminating lease agreements by substituting funds or collateral to fulfill the lessee’s payment obligations.
Definition of "Defeasance" as a method for managing long-term liabilities
This definition focuses on long-term financial obligations.
"Defeasance" refers to a strategy used to manage long-term liabilities by replacing obligations with secure, income-generating assets.
Definition of "Defeasance" as a compliance-driven debt resolution
This definition ties "Defeasance" to regulatory compliance.
"Defeasance" means a debt resolution process designed to meet regulatory compliance by securing liabilities with approved assets or funds.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.