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Recourse debt or recourse loan is a debt that is backed by both collateral from the debtor, and by personal liability of the debtor. [2] This type of debt allows the lender to collect from the debtor and the debtor's assets in the case of default, in addition to foreclosing on a particular property or asset as with a home loan or auto loan.
Commissioner v. Tufts, 461 U.S. 300 (1983), was a unanimous decision by the United States Supreme Court, which held that when a taxpayer sells or disposes of property encumbered by a nonrecourse obligation exceeding the fair market value of the property sold, the Commissioner of Internal Revenue may require him to include in the “amount realized” the outstanding amount of the obligation ...
A non-recourse loan is a type of debt that’s secured by collateral, such as an individual’s car, house or another typically illiquid asset. Consult with a local financial advisor today. How ...
[1] The availability of a deficiency judgment depends on whether the lender has a recourse or nonrecourse loan, which is largely a matter of state law. In some jurisdictions, the original loan(s) obtained to purchase property is/are non-recourse, but subsequent refinancing of a first mortgage and/or acquisition of a 2nd (3rd, etc.) are recourse ...
This case supports the doctrine of U.S. income tax law that a seller of property subject to a nonrecourse debt (as opposed to a recourse debt where the seller may remain liable for any unsatisfied balance remaining after the transfer) realizes an amount that includes the debt assumed by the purchaser. This is an important concept because a ...
For example, most mortgages are made in forms Fannie and Freddie created, and both have instructed lenders to use nonjudicial foreclosures to save money, even though judicial foreclosures, with ...
If parties have joint liability, each of them is liable up to the full amount of the relevant obligation. Example: Alex and Bobbie are married. Together they take a loan from a bank and the loan agreement specifies that they are to be jointly liable for the full amount. Alex moves overseas and ceases to make payments.
The accounting equation relates assets, liabilities, and owner's equity: Assets = Liabilities + Owner's Equity. The accounting equation is the mathematical structure of the balance sheet. Probably the most accepted accounting definition of liability is the one used by the International Accounting Standards Board (IASB). The following is a ...