The Law Dictionary

Featuring Black’s Law Dictionary Free Online Legal Dictionary 2nd Ed.

What is OBLIGATION BOND

An instrument for debt whose value is estimated to be greater than the market value of the assets that are mortgaged. In the event that the borrower defaults on his loan, the lender is entitled upon foreclosure. And in this instance, the borrower is obligated to compensate the lender with the balance remaining upon the sale of assets.

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