Accrual Rate
The accrual rate is the periodic rate at which interest is due (accrues) on a mortgage. It can differ from the pay rate in structures where interest accrues differently than it is currently paid.
- Where it applies
- Generally, not specific to New York
- When it comes up
- Structuring; servicing; securitization reporting (if applicable)
- Property types
- Residential and commercial
In practice
In structured products and some floating-rate instruments, mismatches between accrual and pay conventions drive timing differences that matter for cash-flow modeling.
Related terms
Residential Financing
- Adjustable Rate Mortgage (ARM)
- Amortization
- Application (TRID application)
- Conforming Loan Limit
- Pay Rate
- PMI Automatic Termination
- PMI Cancellation (Borrower-Requested)
- Private Mortgage Insurance (PMI)
- Secured Overnight Financing Rate (SOFR)
- TILA-RESPA Integrated Disclosures (TRID)
General information, not legal, tax or financial advice.