Definition of «conduit loan»

A conduit loan is a type of commercial real estate loan where a lender provides funds to borrowers for purchasing or refinancing properties. The lender then packages these loans into a pool and sells them off to investors as mortgage-backed securities. This allows the lender to free up capital to make more loans while investors earn returns from the interest payments made by the borrowers.

Sentences with «conduit loan»

  • Interest rates on conduit loans are normally fixed and lower than rates on a traditional mortgage. (valuepenguin.com)
  • Between now and 2018, $ 205.2 billion of conduit loans come due, with $ 87.1 billion maturing this year and $ 105.8 billion in 2017. (info.trepp.com)
  • Because conduit loans are packaged and sold to investors, prepayment is not always an option. (valuepenguin.com)
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