Exchange Currency

wraparound debt

Mortgage debt in which the face amount of the loan overstates the actual debt; incorporates a special agreement between the parties for payment of debt service on the existing mortgage. The borrower pays the wraparound lender who in turn pays the debt service on the existing loan. The wrap is secured by a promissory note and mortgage document. The amount of the face value of the wrap is the sum of the outstanding balance on the existing mortgage plus the additional funds advanced to the borrower by the wraparound lender, with the result that the wrap "wraps around" the existing loan.

Related information about wraparound debt:
  1. What is wraparound debt? definition and meaning
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  8. Holtkamp v Parklex Assoc. :: February, 2011 :: New York Other - Justia
    Feb 22, 2011... due date, instead of foreclosing on the wrap mortgage, the wraparound debt was converted into a 95% limited partnership interest in Parklex.