An obligor, also known as a borrower, is an individual or enterprise who is lawfully or contractually required to provide a advantage or transaction to another.
In a financial perspective, the word “obligor” represents a Correlation company who is contractually likely to make all major installments and attention rates on excellent financial debt. The receiver of the advantage or transaction is known as the obligee.
An obligor is someone who is lawfully likely to another. Debt owners are the most popular kinds of obligors. However, in inclusion to the essential pay back appealing and major, many owners of business financial debt are also contractually needed to fulfill other specifications. For a Correlation owner, these are known as covenants and are defined in the preliminary Correlation problem between the obligor and obligee.
Covenants can be either positive or negative. An positive agreement is something that the obligor is needed to do, such as the need to hit particular performance standards. A negative agreement is limited in that it prevents the obligor from doing something, such as reorientation the management of the company.