Used to manage risk inherent in prepayment. Assumes increase in prepayments with a cap at 30 months. Helps assess speed of prepayment in new loans. 0.2% is the standard increase amount denoting a 2% increase in rate every month until the 30th month.

Random Finance Terms for the Letter P

  • P&L
  • P&S
  • P2P
  • P/E
  • P/E Ratio
  • P/E Effect
  • PSA
  • Pac-Man Strategy
  • Pairoff
  • Paper