Term: Mezzanine Loan

A type of Junior Loan that sits between senior secured debt and junior secured debt. It is secured by the all or a portion of the equity (ownership interests) of the borrower entity. These loans typically have higher interest rates and/or equity in the underlying property. 

The borrower secured a mezzanine loan to bridge the gap in financing for its expansion, knowing that it would come with higher interest rates due to its subordinate position in the capital structure.