prepayment
Paying before due
Prepayment is payment made before it's due or before goods or services are received.
A prepayment penalty is a fee charged when a borrower pays off a loan early—lenders lose expected interest income.
In accounting, prepayments are assets: expenses paid in advance, like rent or insurance premiums covering future periods.
Initial payment toward purchase
- retainerUpfront professional fee
- earnestSincerely intense in purpose
- escrowConditional third-party deposit
- upfrontDirect and honest
advance · installment · layaway · reservation · good-faith
Borrowed money repaid later
- mortgageSecured home loan
- principalChief school administrator
- amortizationGradual debt reduction schedule
- interestAttention, stake, or fee
refinance · penalty · fee · balloon · lender · borrower · debt · credit
Shared position between parties
- obligationRequired task or commitment
- guaranteeFormal promise of fulfillment
- pledgeBinding promise given
- bondBinding tie or connection
covenant · assurance · undertaking · terms · conditions · clause · commitment · stipulation
Noncommittal maneuvering
- protectionGuarding against harm
- lock-inEnforced continued commitment
- safeguardPrecaution against harm
- insuranceContractual risk coverage
collateral · lien · underwriting · surety · indemnity · reserve · mitigation · exposure
downpayment
Initial payment toward purchase
- retainerUpfront professional fee
- earnestSincerely intense in purpose
- escrowConditional third-party deposit
upfront · advance · installment · layaway · reservation · good-faith
loan
Borrowed money repaid later
- mortgageSecured home loan
- principalChief school administrator
- amortizationGradual debt reduction schedule
interest · refinance · penalty · fee · balloon · lender · borrower · debt · credit · installment
agreement
Shared position between parties
- obligationRequired task or commitment
- guaranteeFormal promise of fulfillment
- pledgeBinding promise given
bond · covenant · assurance · undertaking · terms · conditions · clause · commitment · stipulation · provision
hedging
Noncommittal maneuvering
- protectionGuarding against harm
- lock-inEnforced continued commitment
- safeguardPrecaution against harm
insurance · collateral · lien · underwriting · surety · indemnity · reserve · mitigation · exposure · default
- paymentscredit cards, debit cards, credit card, debit card, paycheck
- Payment Typesinstallments, autopay, direct deposit, wire transfer, layaway
- transactionspurchase, deposit, transfer, money transfer, cash transfer
- reservationsreservation, booking, hotel reservation, room reservation, table reservation
- lendingloans, borrower, approval, lenders, bank loan
- mortgagesfixed-rate mortgage, mortgage broker, adjustable-rate mortgage, mortgage insurance, mortgage deed
prepaymentdeferred payment
Buying before paying
arrears · cash on delivery · COD · pay later · installment payment
prepaymentcredit
Recognition or payment deferral
buy now pay later · net 30 · credit terms · financing · loan
- prepayment planEarly settlement schedule
- prepayment penaltyFee for accelerated loan closure