paydowns
Loan balance decreases
Paydowns are reductions of debt principal, typically through scheduled or accelerated payments.
In finance, the term often appears in discussions of mortgages or bonds: The fund's returns depend partly on paydowns from the underlying loans.
Paydowns reduce what's owed faster than interest-only payments would.
Renegotiating borrower payment terms
- deleveragingLowering financial leverage ratios
- balance sheetAssets-liabilities-equity report
- solvencyCapacity to pay debts
- liquidityConvertibility to cash
refinancing · debt-to-equity · corporate bonds · term loan · revolving credit · credit rating · bondholder
Obtain new loan terms
- escrowConditional third-party deposit
- loan-to-valueDebt-to-collateral ratio
- underwater mortgageLoan exceeding property value
- homeownershipLegally possessing residential property
fixed-rate · adjustable-rate · recast · second mortgage · HELOC · foreclosure prevention · lender · borrower
Repayment by ascending balance
- outstanding balanceSum still due
- debt-freeWithout financial obligations
- early payoffDebt settled before term
Safeguarding original investment value
- risk reductionLessening of potential harm
- securitiesTradeable financial assets
- asset allocationDistributing investments strategically
- yieldProduce or relinquish
investment strategy · brokerage account · margin call · collateral
debt restructuring
Renegotiating borrower payment terms
- deleveragingLowering financial leverage ratios
- balance sheetAssets-liabilities-equity report
- solvencyCapacity to pay debts
liquidity · refinancing · debt-to-equity · corporate bonds · term loan · revolving credit · credit rating · bondholder
refinance
Obtain new loan terms
- escrowConditional third-party deposit
- loan-to-valueDebt-to-collateral ratio
- underwater mortgageLoan exceeding property value
homeownership · fixed-rate · adjustable-rate · recast · second mortgage · HELOC · foreclosure prevention · lender · borrower · closing costs
debt snowball
Repayment by ascending balance
- outstanding balanceSum still due
- debt-freeWithout financial obligations
- early payoffDebt settled before term
capital preservation
Safeguarding original investment value
- risk reductionLessening of potential harm
- securitiesTradeable financial assets
- asset allocationDistributing investments strategically
yield · investment strategy · brokerage account · margin call · collateral