Amortizing Security

外汇网2021-06-19 14:09:02 62

A class of debt security in which a portion of the underlying principal amount is paid in addition to periodic interest payments to the security's holder. The regular payment that the security holder receives is derived from the payments that the borrower makes in paying off the debt.

|||Mortgage-backed securities (抵押贷款支持债券) are one of the most common forms of amortizing security. With an 抵押贷款支持债券, the monthly mortgage payments that mortgagors make are pooled together and are then distributed to 抵押贷款支持债券 holders. Depending on the way in which a security is structured, holders of these investments may be subject to ppayment risk, as it is not uncommon for the underlying borrower to ppay a portion, if not all, of the debt's principal. In the event that ppayment occurs, the investor will receive the rest of the principal and no more interest payments will occur.

标签：