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Self-liquidating assets

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Lexicon Term of the Day Email campaigns Subjects. Business Dictionary. Toggle routing. Uh oh! You're not signed up. Close navigation. Popular Terms. Asset that generates adequate profits to return the total sum of its cost , such as a transporter's truck furthermore a bank's mortgage loan case.

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The definition of self-liquidating in the dictionary is used to finance transactions whose proceeds are expected to accrue before the date of redemption or repayment. Other definition of self-liquidating is yielding proceeds sufficient to cover the initial outlay or to finance any recurrent outlays. Educalingo cookies are used to personalize ads and get web traffic statistics.
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  • Definition of self liquidating asset: Asset that generates adequate income to return the total amount of its cost,...
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Self-liquidating assets A self-liquidating loan is a form of short- or intermediate-term credit that is repaid with money generated by the assets it is used to purchase. The repayment schedule and maturity of a self-liquidating loan are timed to coincide with when the assets are expected to produce income. These loans are intended to finance purchases that will quickly and reliably generate cash. Although few loans are legally named "self-liquidating," the term is commonly used by bankers to refer to lending arrangements that work in this manner. It is also used by some scam artists, as we explain below. A retail business might use a self-liquidating loan to purchase extra inventory in anticipation of the holiday shopping season. The revenue generated from selling that inventory would then be used to repay the loan.
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