First and foremost is to understand the basic meaning of. Any hybrid of equity or debt giving the proper right to any lender is considered to be a mezzanine loan. When you take care of mezzanine loans you\’re dealing with very high cost of capital So the result was a obligation or subordinated in a capital structure of the company. Basically, mezzanine capital is said to be a commercial broker because it deals with lender or finance. The more expensive source of finance is really a mezzanine capital.
Mezzanine capital is really crucial in any business. The following are some of the important elements: ? The Secured debt ? High cost of capital ? Provide private placement ? Involve in greater amount ? Preferred stock ? Expansive capital