Sentences with phrase «higher default rate of»

According to the CARD Act of 2009 lenders can only begin charging a higher default rate of interest when an account has become 60 days past due.

«junk bond king» wrote a thesis that two percentage points were enough compensation for the likely higher default rate of a junk bond fund over a corporate bond fund.

Not exact matches

These products pay well above the 10 - year Canadian government rate, but they are riskier to own — the higher coupon corresponds to a higher chance of default.

Among those that Moody's rates, there were nine defaults in the first quarter, an «all - time high,» as Moody's put it, «reflecting the fallout of changing consumer behavior and advancing e-commerce for traditional brick - and - mortar retail.»

These types of loans also carry other risks, such as demand provisions under which a bank can arbitrarily demand repayment, as well as high default rates, putting borrowers in a difficult spot.

The school network has high attrition rates and numerous cases of families defaulting or falling behind on tuition payments.

Investors could decide to ditch investments in the developing world both because higher rates in rich countries would make those investments comparatively less attractive and because their appetite for risk would likely drop in case of a U.S. default.

If it is mainly the highest - risk borrowers who take advantage of higher limits, or if the higher limits encourage more reckless borrowing in general, then default rates will climb, eating away at profit margins.

Investing in higher - yielding, lower - rated, floating - rate loans and debt securities involves greater risk of default, which could result in loss of principal — a risk that may be heightened in a slowing economy.

High - yield bonds represented by the Bloomberg Barclays High Yield 2 % Issuer Capped Index, comprising issues that have at least $ 150 million par value outstanding, a maximum credit rating of Ba1 or BB + (including defaulted issues) and at least one year to maturity.

Advice: Because bonds with longer maturity face greater risk of changing interest rates (and greater default risk, as well), they typically pay higher interest rates.

However, their default rates is the highest out of all the platforms we have invested.

In fact, you often end up earning way more $ $ $, at higher interest rates, as I did on 2 of my defaulted investments.

Many employers are reluctant to suggest higher default contribution rates due to a concern that their workers might blindly accept what is not in their best interest, or that they might get intimidated and opt out of the plan altogether,» says Dr. Shlomo Benartzi, senior academic advisor to the Voya Behavioral Finance Institute for Innovation.

Because credit and default risk are the dominant drivers of valuations of high yield bonds, changes in market interest rates are relatively less important.

Quantitative easing subsidizes U.S. capital flight, pushing up non-dollar currency exchange rates Quantitative easing may not have set out to disrupt the global trade and financial system or start a round of currency speculation, but that is the result of the Fed's decision in 2008 to keep unpayably high debts from defaulting by re-inflating U.S. real estate and financial markets.

The higher the risk of a default or late payment, the higher the interest rate will be.

The downside to this type of lending is the high default rate.

Specifically, Defendants made false and / or misleading statements and / or failed to disclose that: (i) the Company was engaged in predatory lending practices that saddled subprime borrowers and / or those with poor or limited credit histories with high - interest rate debt that they could not repay; (ii) many of the Company's customers were using Qudian - provided loans to repay their existing loans, thereby inflating the Company's revenues and active borrower numbers and increasing the likelihood of defaults; (iii) the Company was providing online loans to college students despite a governmental ban on the practice; (iv) the Company was engaged overly aggressive and improper collection practices; (v) the Company had understated the number of its non-performing loans in the Registration Statement and Prospectus; (vi) because of the Company's improper lending, underwriting and collection practices it was subject to a heightened risk of adverse actions by Chinese regulators; (vii) the Company's largest sales platform and strategic partner, Alipay, and Ant Financial, could unilaterally cap the APR for loans provided by Qudian; (viii) the Company had failed to implement necessary safeguards to protect customer data; (ix) data for nearly one million Company customers had been leaked for sale to the black market, including names, addresses, phone numbers, loan information, accounts and, in some cases, passwords to CHIS, the state - backed higher - education qualification verification institution in China, subjecting the Company to undisclosed risks of penalties and financial and reputational harm; and (x) as a result of the foregoing, Qudian's public statements were materially false and misleading at all relevant times.

Floating - rate loans» low credit ratings indicate greater potential risk of default relative to investment - grade bonds (though default rates for floating - rate loans historically have been lower than on high - yield bonds).

For roughly three decades, U.S. non-financial corporate debt as a percentage of U.S. nominal GDP and the high yield default rate moved in tandem.

Rising interest rates are likely to result in investors projecting ahead to slower economic growth and the possibility of higher default rates.

Investments in high - yield («junk») bonds involve greater risk of price volatility, illiquidity, and default than higher - rated debt securities.

The best way to stay out of default is to avoid taking on high - interest rate, long - term car loans — which creditors often market to low - income, poor credit score consumers.

High - yield corporate bonds are rated below investment grade and are subject to greater risk of default, which could result in loss of principal — a risk that may be heightened in a slowing economy.

This is because these loan types are associated with layaway plans and «loans of last resort», which tend to default at very high rates.

Such options often include local automobile dealers and / or local finance companies which are likely to charge them higher interest rates to offset the higher risk of them defaulting on loans.

These bonds offer higher yields but are coupled with a higher risk of default, as signified by these companies» lower credit ratings.

Holding an individual bond to maturity will result in the return of principal (assuming the bond issuer doesn't default), but those nominal dollars will be worth less with inflation and during periods of higher interest rates.

These bonds are issued by less - creditworthy companies that carry a higher risk of default than better - rated issuers.

For older borrowers who rely on student loans to finance their own education, government statistics show their default rate is much higher than that of younger borrowers.

Many of these stocks have depressed valuations due to concerns that rising rates would increase their cost of capital, decrease mortgage activity, lead to higher rates of default, and decrease their attractiveness to yield - seeking investors.

The company, whose best - known subsidiary is The University of Phoenix, has come under government scrutiny on grounds that it recruits under - qualified students who later default at a high rate on their government - subsidized loans.

Probably 8 out of 10 would say no for two reason: (1) the rating agencies gave high ratings to their lending activites and (2) the insurance companies (e.g. AIG) were giving them what they thought was a solid insurance policy against default.

Allowing defaults would cause future and current borrowers with adjustable rates to essentially be punished with higher interest rates to offset the minority of defaulting borrowers.

The Syracuse Post-Standard ranked the Upstate New York colleges where students were least likely to get a degree, and had the highest rates of default on their federal loans.

But because they're a small biotech company, with high risk of default (i.e., a high risk of not paying off their debts), they would have to pay a very high interest rate in order to make the bond attractive enough for investors to purchase it.

But the system of multiple plans is too complicated and difficult to navigate, default rates remain stubbornly high, and the latest estimates project significant long - term costs to taxpayers.

The default rate of black graduates is significantly higher than the default rate for first generation, low - income graduates (13 percent, not shown in table).

While much attention has been given to the high rates of default among dropouts (24 percent), defaults are actually even higher among those who complete a postsecondary certificate (28 percent).

Scott - Clayton and Li (2016) provide evidence that poorer labor market outcomes and for - profit enrollment at the graduate level contribute to high rates of default among black college graduates.

[xxxii] A recent study by Jackson and Reynolds, for example, finds that loans promote higher rates of persistence and completion among black undergraduates, and concludes that despite racial gaps in default rates, loans are nonetheless «an imperfect, but overall positive tool for reducing educational inequality» by race.

In 2006, a U.S. Department of Education report noted that black graduates were more likely to take on student debt, and in 2007, an Education Sector analysis of the same data found that black graduates from the 1992 - 93 cohort defaulted at a rate five times higher than that of white or Asian students in the 10 years after graduation (Hispanic / Latino graduates showed a similar, but somewhat smaller disparity).

[2] More recent work that tracks debt outcomes for individual borrowers documents that the main problem is not high levels of debt per student (in fact, defaults are lower among those who borrow more, since this typically indicates higher levels of college attainment), but rather the low earnings of dropout and for - profit students, who have high rates of default even on relatively small debts.

Riskier loans command higher interest rates than safer loans because of the greater chance of default on the repayment of the risky loan.

They find that the higher the percentage of public employee who are unionized, the greater risk investors see of the state defaulting on its bonds, resulting in higher interest rates

However, arrears and default rates are higher, and have risen more, among customers with the lowest credit ratings, who account for about 3 % of lending.

For example, the yields on CCC - rated high yield bonds are quite low on a 10 - year basis given the historically higher default rates in this low - quality portion of the market.

Because adding debt against the value of your house increases your risk of default, lenders charge higher interest rates for second mortgages.

For younger students, who do not have sufficient credit history, monthly payments on private student loans could be hardly bearable, as the interest rate set by lenders is typically very high to offset potential risk of default.