Extra feature in a loan, beyond ordinary payments of interest, demanded by a lender as a condition for extending credit. The effect is to increase the yield over the term of the financing. From a legal viewpoint, kickers have to be disclosed in consumer loans as part of the finance charges, and in some instances may violate state usury laws.
In real estate finance, a kicker is an equity participation in the gross receipts from rental property, or an ownership stake in the property itself. In an Equity Kicker the lender gets a given interest rate, plus a percentage of the rent over a certain dollar amount. Other forms of kickers are stock warrants exercisable at a future date, and rights to purchase securities.