For a large corporation with a good credit rating seeking to finance corporate real estate,the cost of a mortgage loan may be greater than the cost of unsecured corporate debt.

Question

Quizplus · Accepted Answer

This is because mortgage loans are typically secured by collateral (i.e. the real estate property itself), which allows banks to offer lower interest rates. Unsecured corporate debt, on the other hand, does not have collateral and therefore carries a higher interest rate to compensate for the added risk.

For a Large Corporation with a Good Credit Rating Seeking