|FHA prepayment experience|
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Definition of FHA prepayment experience
FHA prepayment experience
The percentage of loans in a pool of mortgages outstanding at the origination
There is typically a lag of about three months between the time the weighted
A payment made in advance of when it is treated as an expense for profit purposes.
Also called speed, the estimated rate at which mortgagors pay off their loans ahead of
Payments made in excess of scheduled mortgage principal repayments.
assumption The assumption of payment of scheduled principal and interest with no payments.
Advertising designed to elicit sales to customers who can be
Payment of a financial obligation later than is expected or required, as in lead and lag. Also, the number
the cost of spoiled work less the estimated disposal value of that work
spoilage that has been planned or foreseen; is a product cost
Payments made in excess of scheduled mortgage principal repayments.
Spoilage arising from the production process that exceeds the normal
The amount of spoilage that naturally arises as part of a production
Clause causing repayment of a debt, if specified events occur or are not met.
Belief that an effort to keep unemployment below its natural rate results in an accelerating inflation.
expenses that have to be recorded in order for the financial statements to be accurate. Accrued expenses usually do not involve the receipt of an invoice from the company providing the goods or services.
accrued expenses payable
The account that records the short-term, noninterest-
A method of budgeting that develops budgets based on expected activities and cost drivers – see also activity-based costing.
activity-based budgeting (ABB)
planning approach applying activity drivers to estimate the levels and costs of activities necessary to provide the budgeted quantity and
A method of costing that uses cost pools to accumulate the cost of significant business activities and then assigns the costs from the cost pools to products or services based on cost drivers.
activity based costing (ABC)
A relatively new method advocated for the
activity-based costing (ABC)
a process using multiple cost drivers to predict and allocate costs to products and services;
Activity-based costing (ABC)
A cost allocation system that compiles costs and assigns
activity-based management (ABM)
a discipline that focuses on the activities incurred during the production/performance process as the way to improve the value received
A payment made by a customer to the company, or by the company to a
A promise to sell an asset before the seller has lined up purchase of the asset. This
Advance material request
Very early orders for materials before the completion
After-tax profit margin
The ratio of net income to net sales.
Annual fund operating expenses
For investment companies, the management fee and "other expenses,"
Annual percentage rate (APR)
The periodic rate times the number of periods in a year. For example, a 5%
annual percentage rate (APR)
Interest rate that is annualized using simple interest.
Annual percentage yield (APY)
The effective, or true, annual rate of return. The APY is the rate actually
Yearly amount payable by a client for a policy or component.
Yearly record of a publicly held company's financial condition. It includes a description of the
The report required by the Stock Exchange for all listed companies, containing the company’s financial statements.
A report issued to a company’s shareholders, creditors, and regulatory
The fund return, for any 12-month period, including changes in unit value and the reinvestment of distributions, but not taking into account sales, redemption, distribution or other optional charges or income taxes payable by any unitholder that would reduce returns.
If stock X appreciates 1.5% in one month, the annualized gain for that sock over a twelve
Annualized holding period return
The annual rate of return that when compounded t times, would have
Arithmetic average (mean) rate of return
Arithmetic mean return.
Methods of financing in which lenders and equity investors look principally to the
loans granted usually by a financial institution where the asset being financed constitutes the sole security given to the lender.
attribute-based costing (ABC II)
an extension of activitybased costing using cost-benefit analysis (based on increased customer utility) to choose the product attribute
Automatic Benefits Payment
Automatic payment of moneys derived from a benefit.
An arithmetic mean of selected stocks intended to represent the behavior of the market or some
Average accounting return
The average project earnings after taxes and depreciation divided by the average
Average (across-day) measures
An estimation of price that uses the average or representative price of a
Average age of accounts receivable
The weighted-average age of all of the firm's outstanding invoices.
Average Amortization Period
The average useful life of a company's collective amortizable asset base.
Average Collection Period
average number of days necessary to receive cash for the sale of
Average collection period, or days' receivables
The ratio of accounts receivables to sales, or the total
Average-Cost Inventory Method
The inventory cost-flow assumption that assigns the average
Average cost of capital
A firm's required payout to the bondholders and to the stockholders expressed as a
The beginning inventory for a period, plus the amount at the end of
Also referred to as the weighted-average life (WAL). The average number of years that each
The average time to maturity of securities held by a mutual fund. Changes in interest rates
Average Propensity to Consume
Ratio of consumption to disposable income. See also marginal propensity to consume.
Average Propensity to Save
Ratio of saving to disposable income. See also marginal propensity to save.
Average rate of return (ARR)
The ratio of the average cash inflow to the amount invested.
Average tax rate
Taxes as a fraction of income; total taxes divided by total taxable income.
average tax rate
Total taxes owed divided by total income.
Balance of payments
A statistical compilation formulated by a sovereign nation of all economic transactions
Balance of Payments
The difference between the demand for and supply of a country's currency on the foreign exchange market.
Balance of Payments Accounts
A statement of a country's transactions with other countries.
Gives the lessee the option to purchase the asset at a price below fair market
Before-tax profit margin
The ratio of net income before taxes to net sales.
The cumulative book income plus any gain or loss on disposition of the assets on termination of the SAT.
Break-even lease payment
The lease payment at which a party to a prospective lease is indifferent between
Break-even payment rate
The prepayment rate of a MBS coupon that will produce the same CFY as that of
Related: Premium payback period.
cash flow from operating activities, or cash flow from profit
This equals the cash inflow from sales during the period minus the cash
Cash flow time-line
Line depicting the operating activities and cash flows for a firm over a particular period.
Clearing House Automated Payments System (CHAPS)
A computerized clearing system for sterling funds
Clearing House Interbank Payments System (CHIPS)
An international wire transfer system for high-value
A transaction in which the purchaser's intention is to reduce or eliminate a short position in
Conflict between bondholders and stockholders
These two groups may have interests in a corporation that
The profit made by a division after deducting only those expenses that can be controlled by the
The costs of (cross-functional) business processes, irrespective of the organizational structure of the business.
a collection of monetary amounts incurred either
A cluster of cost items.
Cost–volume–profit analysis (CVP)
A method for understanding the relationship between revenue, cost and sales volume.
analysis a procedure that examines
The periodic interest payment made to the bondholders during the life of the bond.
Detachable certificate attached to a bond that shows the amount of
The interest payments paid to the bondholder.
The annual interest payment associated with a bond.
Any bond with a coupon. Contrast with discount bond.
Coupon / Coupons
The periodic interest payment(s) made by the issuer of a bond
The dates when the coupons are paid. typically a bond pays
Coupon equivalent yield
True interest cost expressed on the basis of a 365-day year.
A bond's interest payments.
In bonds, notes or other fixed income securities, the stated percentage rate of interest, usually
The rate of interest paid on a debt security. Generally stated on an
The nominal interest rate that the issuer promises to pay the
annual interest payment as a percentage of face value.
The exchange rate between two currencies expressed as the ratio of two foreign exchange rates
A bond selling at or close to par, that is, a bond with a coupon close to the yields currently
Related: Benchmark issues
Current Income Tax Expense
That portion of the total income tax provision that is based on
Current Tax Payment Act of 1943
A federal Act requiring employers to withhold income taxes from employee pay.
the time between the placement of an order to
Date of payment
Date dividend checks are mailed.
Days' sales outstanding
average collection period.
Deferred Income Tax Expense
That portion of the total income tax provision that is the result
Delivery versus payment
A transaction in which the buyer's payment for securities is due at the time of
An expense account that represents the portion of the cost of an asset that is being charged to expense during the current period.
Direct stock-purchase programs
The purchase by investors of securities directly from the issuer.
Dollar-weighted rate of return
Also called the internal rate of return, the interest rate that will make the
Dow Jones industrial average
This is the best known U.S.index of stocks. It contains 30 stocks that trade on
Dow Jones Industrial Average
Index of the investment performance of a portfolio of 30 “blue-chip” stocks.
Effective annual interest rate
An annual measure of the time value of money that fully reflects the effects of
effective annual interest rate
Interest rate that is annualized using compound interest.
Effective annual yield
annualized interest rate on a security computed using compound interest techniques.
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