Glossary of Municipal Securities Terms

PREPAYMENT SPEED

The rate of principal repayments (also known as “speed”) of home mortgages funded from mortgage revenue bonds. The rate of repayments is affected by a number of factors, depending upon the type of mortgage loan, the existence of certain types of guarantees or insurance on the loans, the interest rate environment and other economic factors. Various indices have been developed to estimate the likely rate of repayments depending upon certain of these factors. See: HOUSING REVENUE BOND; PLANNED AMORTIZATION CLASS BOND.

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