An unsecured bond, also referred to as a debenture or plain bond, is a loan obtained by a company without any specific asset serving as collateral. In the event that the company fails to repay the loan, the lender does not have the right to seize any of the company’s assets to recover their funds. Instead, the lender depends on the company’s reputation and creditworthiness to guarantee repayment.
An unsecured bond, also referred to as a debenture, is a type of bond that lacks any specific asset or collateral as security. Instead, it relies solely on the issuer’s general credit and financial reputation. For instance, if a company issues unsecured bonds, investors who purchase these bonds depend on the company’s overall financial health and creditworthiness to repay the debt. In the event of default, investors cannot claim any specific assets as collateral. There are various types of debentures, including convertible debentures, convertible subordinated debentures, sinking-fund debentures, and subordinate debentures. Unsecured bonds are generally considered riskier than secured bonds due to the absence of specific collateral. However, they may offer higher yields to compensate for this increased risk.
An unsecured bond is a type of bond that does not require the defendant to put up any collateral or property as security for their release from jail.
With an unsecured bond, the defendant is released from jail without having to pay any money upfront. However, if they fail to appear in court as required, they may be required to pay the full amount of the bond.
The requirements for obtaining an unsecured bond vary by jurisdiction, but generally, the defendant must have a low flight risk and a good record of appearing in court.
Not everyone is eligible for an unsecured bond. Factors such as the severity of the charges, the defendant’s criminal history, and the likelihood of the defendant appearing in court are taken into consideration.
If the defendant fails to appear in court as required, they may be required to pay the full amount of the bond and could face additional legal consequences.
Yes, an unsecured bond can be revoked if the defendant violates the terms of their release or fails to appear in court.
There may be administrative fees associated with obtaining an unsecured bond, but these fees are typically much lower than the amount required for a secured bond.
Unsecured bonds are typically used for non-violent and low-level offenses. More serious charges may require a secured bond.
A defendant can request an unsecured bond, but it is ultimately up to the judge to decide whether to grant it based on the specific circumstances of the case.
If you or a loved one is facing criminal charges and is interested in obtaining an unsecured bond, it is best to consult with a qualified criminal defence attorney who can assess the situation and provide guidance on the best course of action.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 17th April 2024.
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