Glossary
Key Information Document (KID)
A standardised document that provides clear and comparable information about a given investment product.
Land Rent
A periodic payment received for the use of agricultural land. It may be paid in money or in kind, for example as part of the agricultural produce. Land rent is usually agreed for a shorter period and is not necessarily based on a long-term agricultural lease.
Lease
A financial agreement in which the lessor grants the lessee the right to use an asset, such as a car or equipment, for a specified period in exchange for regular lease payments.
Legal Tender - glossary for children
The official money of a country that, by law, everyone must accept when paying with it.
Lender (Loan Provider)
A natural or legal person (including a financial institution) that provides money, goods, or services to another person (the borrower) under certain conditions – usually against interest and with an agreed repayment period. The lender has the right to demand fulfilment of the agreed terms, including repayment of the principal and interest, and in some cases the loan may be secured with property or other guarantees.
Lessee
A natural or legal person that receives the right to use an asset provided by the lessor in exchange for regular lease payments. The lessee uses the asset during the lease term and, in the case of finance lease, usually has the option to purchase the asset after the lease term expires.
Lessor
A financial institution licensed by the Bulgarian National Bank that grants the lessee the right to use a specific asset in exchange for regular lease payments. The lessor retains ownership of the asset during the lease term, and in the case of finance lease, the lessor may transfer ownership of the asset to the lessee at the end of the lease term if a purchase option is provided.
Level of Indebtedness
This is usually measured by the “debt-to-income” ratio, which indicates what portion of a person’s income is used to repay loan obligations.
Leverage
A method by which traders use borrowed funds to increase the potential profit of a trade. With leverage, investors deposit only a small percentage of the position’s value as margin, allowing them to control a significantly larger amount of financial assets with a relatively small personal investment.
Liability Insurance
An insurance product that provides protection for individuals or legal entities against claims from third parties for property or non-property damages resulting from their activities or conduct. In the event of an occurrence for which the insured is legally or contractually liable, the insurer assumes the obligation to cover the costs of compensation to the injured parties up to the limits agreed in the policy. This insurance may be compulsory by law (e.g. motor third-party liability) or voluntary and can cover professional, employer’s, product, and other types of liability.
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