Series 24: 3.5.6.1. Face-Amount Certificate Companies

Taken from our Series 24 Online Guide

3.5.6.1. Face-Amount Certificate Companies

A face-amount certificate company issues debt securities, called face-amount certificates. The certificates are backed by offering the company’s assets, such as real property or other securities, as collateral. Issuers of face-amount certificates promise to pay a stated amount (the face amount) to the investor at a future time specified by contract. In return, investors pay the issuer a fixed amount of money, either as a lump sum payment or in periodic installments. When the investor pays for the certificate in a lump sum, the investment is known as a fully paid face-amount certificate. With a “face-amo

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