Recourse Status Sample Clauses

The Recourse Status clause defines whether a lender has the right to seek repayment from a borrower beyond the collateral securing a loan. In practice, this clause specifies if the lender’s recovery is limited to the pledged assets (non-recourse) or if the lender can pursue the borrower’s other assets (recourse) in the event of default. By clearly establishing the extent of the lender’s remedies, this clause allocates financial risk between the parties and provides clarity on the consequences of a borrower’s default.