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A yield spread premium (YSP) is the money or rebate paid to a mortgage broker for giving a borrower a higher interest rate on a loan in exchange for lower up front costs, generally paid in origination fees, broker fees or discount points.
In finance, the yield spread or credit spread is the difference between the quoted rates of return on two different investments, usually of different credit qualities but similar maturities. It is often an indication of the risk premium for one investment product over another.
[1] [2] It began in Japan and the United States (US), and spread through the rest of the world. [3] After the recession of the early 1990s , historically low interest rates in many industrialized nations preceded an unexpectedly volatile year for bond investors, including those that held on to mortgage debts.
The Federal Reserve adopted new standards that ban yield spread premiums on mortgages, a practice that critics say led to homebuyers being saddled with unfairly high mortgage rates. The premiums ...
The Federal Reserve has banned mortgage fees you probably weren't even aware of, but that were inflating your home-loan interest rate. On Monday, the Fed announced it was banning yield spread ...
The Fed spelled out its goals yesterday: "Prohibit lenders from paying mortgage brokers "yield spread premiums" that exceed the amount the consumer Abuses the Fed hopes to correct with the new ...
In finance, mortgage yield is a measure of yield of mortgage-backed bonds.It is also known as cash flow yield. The mortgage yield, or cash flow yield, of a mortgage-backed bond is the monthly compounded discount rate at which net present value of all future cash flows from the bond will be equal to the present price of the bond.
But first, the background. If you've refinanced your mortgage without paying closing costs, there's a ... 24/7 Help. For premium support please call: 800-290-4726 more ways to reach us. Mail. Sign ...