In exchange for the loss of some present value of the interest and principal on a loan after a rescheduling, the lender avoids the permanent loss that would result from a default.

Question

Quizplus · Accepted Answer

This statement is true. Rescheduling a loan may result in a decrease in the present value of the interest and principal, but it allows the lender to avoid the permanent loss that would result from a default.

In Exchange for the Loss of Some Present Value of the Interest