Non-Recourse Finance

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DEFINITION of 'Non-Recourse Finance'

A loan where the lending bank is only entitled to repayment from the profits of the project the loan is funding, not from other assets of the borrower.

INVESTOPEDIA EXPLAINS 'Non-Recourse Finance'

These types of projects are characterized by high capital expenditures, long loan periods, and uncertain revenue streams. Analyzing them requires a sound knowledge of the underlying technical domain as well as financial modeling skills.

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RELATED FAQS
  1. What is the difference between a non-recourse loan and a recourse loan?

    The essential difference between a recourse and non-recourse loan has to do with which assets a lender can go after if a ... Read Full Answer >>
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