Dictionary of Banking Terms: paydown
paydown
- partial reduction of a debt, as when a consumer pays off a part of the outstanding balance on a credit card, mortgage, or installment loan.
- net reduction of a debt when the amount of new securities issued is less than that of a maturing issue.
Dictionary of Finance and Investment Terms: paydown
paydown
Bonds: refunding by a company of an outstanding bond issue through a smaller new bond issue, usually to cut interest costs. For instance, a company that issued $100 million of 12% bonds a few years ago will pay down (refund) that debt with a new $80 million issue with an 8% yield. The amount of the net deduction is called the paydown.
Lending: repayment of principal short of full payment. See also on account.
