Preferred Debt

Filed Under: ,
Dictionary Says

Definition of 'Preferred Debt '


Debt that is considered more important or has priority over other types of debt. This form of debt obligation has to be paid first and its lien position takes precedence over other debt and equity positions. For example, a first mortgage would be a preferred debt over a second mortgage or a mortgage-backed security holding the mortgage.
Investopedia Says

Investopedia explains 'Preferred Debt '


The interest from these types of debts such as mortgages and equity loans are tax deductible. The main types of preferred debt include interest on mortgages, equity loans and equity lines of credit. Taxes owed to the IRS and first position in other personal loans would be considered preferred debt as well.
comments powered by Disqus
Hot Definitions
  1. Private Equity

    Equity capital that is not quoted on a public exchange. Private equity consists of investors and funds that make investments directly into private companies or conduct buyouts of public companies that result in a delisting of public equity.
  2. Valuation

    The process of determining the current worth of an asset or company. There are many techniques that can be used to determine value, some are subjective and others are objective.
  3. Valuation

    The process of determining the current worth of an asset or company. There are many techniques that can be used to determine value, some are subjective and others are objective.
  4. Tech Street

    A term used in the financial markets and the press to refer to the technology sector. Companies like Intel, Microsoft, Apple and Dell are all considered to be part of Tech Street.
  5. Tech Street

    A term used in the financial markets and the press to refer to the technology sector. Companies like Intel, Microsoft, Apple and Dell are all considered to be part of Tech Street.
  6. Momentum Investing

    An investment strategy that aims to capitalize on the continuance of existing trends in the market. The momentum investor believes that large increases in the price of a security will be followed by additional gains and vice versa for declining values.
Trading Center