What is the role of the early amortization provision

Reference no: EM131781287

Question: The following questions relate to credit card receivable-backed securities:

a. What happens to the principal repaid by borrowers in a credit card receivable-backed security during the lockout period?

b. What is the role of the early amortization provision in a credit card receivable-backed security structure?

c. How can the cash flow of a credit card receivable-backed security be altered prior to the principal-amortization period?

d. Why is the monthly payment rate an important measure to examine when considering investing in a credit card receivable-backed security?

Reference no: EM131781287

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