payment cap

Payment Cap

The maximum periodic payment a borrower may be charged on a contract or agreement. For example, an adjustable-rate mortgage may have a payment cap stating that a payment will not rise over a certain level, even if the formula used to calculate the payment would have it do so. A payment cap reduces the risk of the party making the payments.
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payment cap

A limit on the allowable increase of mortgage payments under an adjustable-rate mortgage.The typical horror story used to illustrate this principle envisions interest rates increasing dramatically so that a capped payment is no longer sufficient to pay accrued interest,much less any principal reductions. In such a situation, the accrued but unpaid interest is added to the principal, making the loan grow larger over time rather than smaller. In most of the real world, loans with payment caps also have interest rate caps, so it is contractually impossible for interest rates to climb to an amount causing negative amortization.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.
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England decided not to introduce such a payment cap, meaning individuals, companies or charities that own large areas of land in England can claim an unlimited basic payment.
For the rest, the amendment puts a 90-day payment cap. VIRTUOUS CYCLE If the MPs pass this amendment and most people of goodwill hope they do I will forgive them all their past, present and future sins.
The PPAs define specific events that allow for the project to be terminated in the event of large cost increases (payment cap) or failure of the project to operate for over one year and agreement by the majority of the project participants to terminate.
Under Maryland's existing agreement with CMS, which was set to expire at the end of 2018, the Maryland Health Services Cost Review Commission (HSCRC) had already implemented a global budget payment cap for each Maryland hospital.
Pew said certain components of its proposal, including the 5 per cent payment cap, had been supported in the past in public comments by several banking groups.
The aggregate amount of the dividend and the dividend equivalent is USD100.7m (the payment cap).
The Consultation on a Public Sector Exit Payment Cap closes on 27 August 2015 and is published on the http://www.gov.uk website.
However, larger farms can typically hit their payment cap when MILC is triggering in only a handful of months.
A pounds 250-a-week payment cap for a one-bed home, pounds 290 for two-beds, pounds 340 for three-beds and pounds 400 for four-beds.
Changed the NLA payment cap from 115% to 74% of the national median
c) The payment cap limits how much the loan's monthly payment (not rate) may change from one period to the next.