Negative equityA situation where the purchaser of a property has taken out a mortgage and some time after the purchase, the value of the property falls below the mortgage amount. For example:Purchase price of property: £80,000Deposit: £10,000Mortgage: £70,000If the value of the property falls below £70,000, the mortgage holder has negative equity in the property.
Negative pledge clauseNegative pledge clause
A bond covenant that requires the borrower to grant lenders a lien equivalent to any liens that may be granted in the future to any other currently unsecured lenders.
Negative covenantNegative covenant
A bond covenant that limits or prohibits certain actions unless the bondholders agree.
Negative income taxNegative income tax
A proposal to assist taxpayer with below-subsistence-level incomes. After filing a tax return, such persons would receive a subsidy to bring them up above the poverty level.
Negative externalityNegative externality
A harmful externality; that is, a harmful effect of one economic agent's actions on another. Considered a distortion because the first agent has inadequate incentive to curtail their action. Examples are pollution from factories (a production externality) and smoke from cigarettes (a consumption externality).
Negative yield curveNegative yield curve
When the yield on a short-term security is higher than the yield on a long-term security, partially because high interest rates are creating a greater demand for short-term borrowing.
Further SuggestionsNegative cash flow
Negative NPV tie in project
N Negative Amortization
Negative working capital