A Note on Hybrid Mortgages
研究了3/27混合抵押贷款的表现，发现其在首次利率调整时提前还款率高，违约率也较高，与浮动利率贷款的支付冲击一致。
We extend previous research on traditional one-year adjustable-rate mortgages (ARMs) by analyzing the performance of 3/27 hybrid instruments. Under this contract innovation, which first appeared in the mid-1990s, note rates are fixed for three years after which they convert to a traditional one-year adjustment schedule with periodic and lifetime caps. We find high rates of prepayment, particularly at time of initial rate adjustment, and relatively high rates of default, as would be consistent with the payment shock that often affects adjustable-rate loans.