What does advance refunding mean?

advance refunding meaning in Law Dictionary

n change of outstanding GOVERNMENT BONDS for a unique dilemma of securities ahead of final maturity associated with the initial issue, typically arranged to make use of a lower INTEREST RATE environment.

advance refunding meaning in Business Dictionary

Arrangement where brand-new bonds tend to be issued to repay formerly issued bonds. The funds discovered from the sale of the new problem is dedicated to securities (usually government bonds) which are put in escrow. The attention and principal payment from all of these securities is used in settling the previously given bonds.