first loss position

Definition

A security's position that will suffer the first economic loss if the assets below it lose value or are foreclosed on.

Use first loss position in a sentence

You should try to figure out how to make someone else be in the first loss position instead of you.

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The first loss position was of special concern to us as we did not want to recognize loss on that asset.

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My brother lost a lot of money investing in mortgage backed securities because he failed to realize the tranche he purchased was in the first loss position.

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first lien debt first mortgage