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WiseOwl58, Attorney
Category: Business Law
Satisfied Customers: 3686
Experience:  Experienced business lawyer.
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ok what do you mean by subtracted out of the final accounting?

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ok what do you mean by subtracted out of the final accounting? and do they have some type of insurance to cover defaults? like i have heard of stuff like default credit swap or something like that and that they can get insurance to cover loss by like AIG?
they evaluate the portfolio and price in the risk of default, which they determine actuarially based upon the region, socioeconomic data and the credit experience in the area.

Good luck to you. I wish you all the best.
Customer: replied 4 years ago.

what about the insurance portion of the question? I have heard that they can obtain some type of default insurance so that if the loan goes bad that the insurance pays them for the loss something like if you own say some rental properties and say there is a fire insurance will pay you for lost rents while it is being fixed any truth to that?

Yes, you can purchase credit default insurance indeed. AIG and Fireman's Fund are likely underwriters of such.

Please rate this answer now a 3, 4 or 5 so I can get credit for the answers I have provided and we can close out this question, David.

Thank you.
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