Net Debt To Assessed Valuation

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DEFINITION of 'Net Debt To Assessed Valuation'

In a municipal bond issue, a ratio measuring the value of the municipality's net debt compared to the specified value of the real property being purchased as assessed for tax purposes.

INVESTOPEDIA EXPLAINS 'Net Debt To Assessed Valuation'

This is one of the factors which determines the quality of a municipal bond issue. The lower a municipality's debt is relative to the assessed value of its property, the less risky its bonds are deemed to be, since there is less risk of the government being unable to finance repayment of the bond issue.

RELATED TERMS
  1. Real Estate

    Land plus anything on it, including buildings and natural resources.
  2. Assessed Value

    The dollar value assigned to a property for purposes of measuring ...
  3. Bond Rating

    A grade given to bonds that indicates their credit quality. Private ...
  4. Assessor

    A local government official who determines the value of a property ...
  5. Default Risk

    The event in which companies or individuals will be unable to ...
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    A debt security issued by a state, municipality or county to ...
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