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1.1 What is waterfall payment and what are the solutions to it?

1.1 What is waterfall payment and what are the solutions to it?

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Answer #1

A waterfall payment is REPAYMENT SCHEME Whereby prioritization are done with regard to repayment of principle and interest based on size or expense of loan i.e companies with multiple loan pays costlier loan first including principle and interest and then pays next costlier loan and so on.
Example, lets Assume CO. XYC has three tranche of loans
Loan A Principle 10 million Interest 4 Million
Loan B Principle 6 million Interest 2 Million
Loan C Principle 2 million Interest 0.5 Million

Lets assume co made profit of 16.5 million then,
Co. will pay loan a fully and then it will pay interest on loan B andc

and next year similarly follow payment system.

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