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IOU

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IOU

a written acknowledgment of a debt, esp. an informal one consisting only of the letters IOU, the sum owed, and the debtor's signature.
Also, I.O.U.


Origin:
1610–20; repr. I owe you
Dictionary.com Unabridged
Based on the Random House Dictionary, © Random House, Inc. 2009.
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IOU   (ī'ō-yōō')   
n.  A promise to pay a debt, especially a signed paper stating the specific amount owed and often bearing the letters IOU.

[From the pronunciation of I owe you.]
The American Heritage® Dictionary of the English Language, Fourth Edition
Copyright © 2009 by Houghton Mifflin Company.
Published by Houghton Mifflin Company. All rights reserved.
Cite This Source
Financial Dictionary

IOU

An abbreviation of the phrase "I owe you."

Investopedia Commentary

An IOU in the business community is actually a legally binding agreement between a borrower and a lender. The terms of the loan are set out in a contract, and, once it's signed, the two parties must abide by the terms of the contract or face legal repercussions. For example, when a corporation issues bonds, it is in essence issuing an IOU to bondholders. The IOU or bond contract sets out the terms, including the principal that will be owed, the interest that will be paid, and the time at which these payments will occur.

Related Links

Bond Basics Tutorial
Advanced Bond Concepts
Corporate Bonds: An Introduction To Credit Risk

See also: Bond, Bond Rating, Corporate Bond, Coupon, Default, Default Risk, Junk Bond, Maturity Date, Principal

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Abbreviations & Acronyms
IOU
a note of debt (from "I owe you")
The American Heritage® Abbreviations Dictionary, Third Edition
Copyright © 2005 by Houghton Mifflin Company.
Published by Houghton Mifflin Company. All rights reserved.
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