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Early repayment period |
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Early repayment periodA period of time that applies to certain types of loan during which a charge will be made if the loan is repaid in full or in part or its terms are varied at the borrower's request.Early repayment period Similar MatchesPrepaymentsPrepaymentsPayments made in excess of scheduled mortgage principal repayments. Repayment termRepayment termThe period of time over which you will repay your mortgage to the lender. Repayment mortgageRepayment mortgageA mortgage where throughout the term, regular payments (usually monthly) are made to partly repay interest on the capital and to partly repay the capital itself (the amount of the loan).Initially the largest proportion of the repayments will be used to pay interest since the capital amount outstanding is at its highest value. Therefore over the initial years the capital will not reduce very much. However as the years proceed more and more of the monthly repayments will be applied to reducing the capital until towards the end of the term the large proportion will be paying off capital and a small proportion paying interest.In the event that interest rates rise then often the monthly repayments will rise accordingly. Alternatively, to keep the same monthly repayments the term will need to be extended. If interest rates fall then the reverse applies. It is usually a requirement of the lender (that is, a building society or bank) providing the mortgage that the borrower takes out life assurance so that repayment is made in the event of his/her death during the term. Repayment periodRepayment periodThe period over which the borrower must repay the lender. Prepayment speedPrepayment speedAlso called speed, the estimated rate at which mortgagors pay off their loans ahead of schedule, critical in assessing the value of mortgage pass-through securities. Further Suggestionsprepayment feePrepayment penalty Repayment plan Repayment vehicle Lag response of prepayments FHA prepayment experience Zero prepayment assumption Repayment mortgage Monthly repayment Prepayment penalty |
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