Monthly Payment Rate (MPR)

Definition

Monthly Payment Rate (MPR) in plain English

When credit-card debts are bundled into bonds, investors watch how fast cardholders actually pay. The Monthly Payment Rate is simply the money collected in a month divided by the total balance owed at the month's start — so if cardholders owed $1,000,000 and paid $150,000 that month, MPR is 15%. A high MPR is reassuring: people are paying briskly, so cash keeps flowing to bondholders. A sinking MPR is an early warning that borrowers are struggling, like noticing your friends taking longer and longer to pay you back.

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• Advance rate
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• B-piece
• Basis risk
• Commercial Mortgage-Backed Security (CMBS)
• Conduit CMBS
• Controlled amortization
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• Cross-collateralization