/PRNewswire/ Colbeck Capital Management and Jason and Anita Colodne, proudly support NewYork-Presbyterian s mission for quality healthcare as well as their.
/PRNewswire/ Colbeck Capital Management and Jason and Anita Colodne, proudly support NewYork-Presbyterian s mission for quality healthcare as well as their.
Colbeck Capital Management Discusses Default Rates and Commercial Lending By Pablo Luna / Wednesday, 06 Jan 2021 02:50PM
Two definitions for default rates
There are two definitions for default rates. The first, Colbeck Capital Management points out, is a vital statistical measure used by both economists and lenders that is defined as the percentage of all outstanding loans that a lender has written off after an extended period of missed payments. This measurement is important to lenders because it helps them determine their exposure to risk, and it is used by economists to evaluate the overall health of the economy.
The second, which is especially important to understand in terms of borrowers and commercial lending, define default rates as the higher interest rate that is imposed on a borrower by a lender when the borrower has missed payments on the loan. The lender in this scenario is not defined strictly as a bank but can be imposed by alterna