A bond feature that allows the bond issuer to buy back the debt from the bondholders at a pre-specified price is called a

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A callability feature allows the bond issuer to buy back the debt from the bondholders at a pre-specified price, which gives the issuer greater flexibility in managing its debt load. A warrant is a security that gives the holder the right to buy a specific amount of the issuer's shares at a predetermined price. A putability feature allows the bondholders to sell the bond back to the issuer at a pre-specified price. A convertibility feature allows the bondholders to convert the bond into the issuer's stock at a pre-specified price. The bond feature described is a callability feature, sometimes referred to as a call provision or callable bond. It gives the issuer the option to redeem (or call back) the bond before maturity at a pre-specified price, which is usually above the current market price. This feature gives the issuer flexibility to manage its debt obligations and take advantage of lower interest rates in the future.

A Bond Feature That Allows the Bond Issuer to Buy