What Is Recourse Accounting?

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Recourse accounting refers to the right to demand payment from an individual in a transaction. Learn more about recourse accounting with help from a banking and financial expert in this free video clip.

Part of the Video Series: Accounting FAQs
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Video Transcript

Hi, I'm Lori Greer from Atlanta, Georgia and I'm here to explain what is recourse accounting. When dealing with recourse accounting that basically refers to the right to demand payment from a person who is in agreement in taking on an obligation. A full recourse loan refers to the right of a lender to take any assets of the borrower if repayment is not made. A limited recourse loan would only allow the lender to take assets named in the load agreement. A non recourse loan limits the lenders rights to the particular asset being financed. This is an approach that is common in home mortgages, other real estate loans or even a loan on a automobile. I'm Lori Greer from Atlanta, Georgia, and that what is known as recourse accounting.


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