grace period investment & finance definition
- A
time period between when a cost is incurred and when a payment is due. Grace
periods often are associated with credit cards that don’t start charging
interest on new purchases until 25 days after the item has been charged.
- A time
period in which insurance won’t be cancelled if a payment isn’t received.
See grace period in Wall Street Words
The period during which the issuer of a bond is not required to make interest payments. For example, a bond issued this year might only start paying interest five years from now. Bonds with grace periods are sometimes issued during a corporate restructuring.
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