Partly Paid Bond

A partly paid bond is a type of bond which is bought using installment payments.

Unlike standard bonds in which the investor lends the bond issuer the full amount dictated by the bonds face value, partially paid bonds require an initial down payment followed up by one or more installment payments.

As a general rule, failure to meet installment payment results in the loss of partly paid bonds along with equity in the bond principal.

Partly paid bonds enable investors to invest in bonds even if they do not have the necessary capital to purchase the bonds in full.

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