medium · Asset-Backed Securities asset-nuances

In student loan ABS modeling, what is a 'PIF' (Paid In Full) and how does it differ from a standard monthly payment?

1. A 'PIF' is a claim payment made to the trust by the guarantor, rather than a payment made directly by the borrower.
2. A 'PIF' is a 'Payment in Forbearance', representing a reduced partial payment made by a borrower during a hardship period.
3. A 'PIF' is a total loan payoff (prepayment), while a monthly payment is the scheduled amortization of principal and interest.
4. A 'PIF' reflects only the outstanding principal balance being collected, whereas a monthly payment also includes accrued interest.

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