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Bow-Tie Loan

 
Banking Dictionary: Bow-Tie Loan
 

Short-term variable rate loan that defers any unpaid interest charges above a pre-determined interest rate. A bow-tie loan rolls any interest due into the loan principal in a long-term loan from a bank lender or investor.

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Banking Dictionary. Dictionary of Banking Terms. Copyright © 2006 by Barron's Educational Series, Inc. All rights reserved.  Read more