Pre-paid Interest
Definition
- Interest that is paid before it is due to save the borrower money on taxes.
Synonyms
upfront interest payments
Alternate Spellings
Pre-paid
Related Terms and Acronyms
- Accrued Interest — Definition,
- Interest which has already been earned but has not yet been paid.
- Interest (IN, int) — Acronym & Abbreviation,
- Money paid for the use of borrowed funds, usually expressed as an annual percentage.
➥ Bank account transaction code. - Interest Factor — Definition,
- The decimal equivalent for an interest rate on a unit amount for a period of time. Computed by interest rate divided by number of days in a basic year times the number of days accrued.
- Interest Rate (IR) — Acronym, Very Important,
- The rate a lender charges an individual to borrow money.
- Loan — Definition,
- Letting another party use something of value temporarily.
- Mortgage (mtg) — Abbreviation, Important,
- A mortgage is a contract stipulating a specific real property, typically a residence or building, as collateral for a loan. The mortgage incurs a rate of interest that varies according to term and other features.
- Point — Definition,
- A point equals 1 percent of a mortgage loan. Some lenders charge "origination points" to cover expenses of making a loan. Some borrowers pay "discount points" to reduce the loan's interest rate.
- Pre-paid Expenses — Definition,
- also called prepaid items or prepaids -- Recurring costs such as taxes, insurance and interest that are paid at closing and which cannot be financed.
