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interest-only (IO)

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interest-only (IO)
Of or relating to a derivative mortgage security scheduled to receive interest only from a pool of mortgages. An IO derivative security has no par value, and the owner of the security can lose money because of mortgage prepayments that reduce or eliminate interest payments. Compare principal-only (PO).

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Classes A1, A2, B, C, D, E, F, G, M-350, G-AON, H-AON, K-AON, M-AON, N-AON, H-WAI, K-WAI, M-WAI, M-DP, M-DH, N-PDL, N-DUN and interest-only (IO) class X-1 have paid in full.
CMBS rating performance to remain strong for the remainder of the year and delinquencies to continue to decline, loan defaults may begin to increase as transactions issued in recent years contain larger interest-only (IO) concentrations and higher amounts of debt.
CMBS are likely to begin ticking up as deals issued over the last few years contain larger concentrations of interest-only (IO) loans and loans with a higher amount of debt, according to the latest CMBS loan default study by Fitch Ratings.
 
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