prepayment risk

What Is Repayment Risk?

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What Is Repayment Risk? Default Risk (Probability of Default or PD) is the risk that a borrower will not follow the agreed loan terms. … As nouns the difference between payment and repayment is that payment is (uncountable) the act of paying while repayment is the act of repaying. What does repayment risk mean? Prepayment

How Bad Is Yield Maintenance?

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How Bad Is Yield Maintenance? The bad news about yield maintenance is that there is typically a minimum premium to be paid by the borrower regardless of the outcome of the yield maintenance calculation, usually 1%. Additionally, unlike defeasance, the outcome of the calculation will never result in an excess premium being paid back to