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How is average life defined for the purposes of the haircut table?

April 26, 2017average defined haircut life purposes Table

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How is average life defined for the purposes of the haircut table?

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For ABS with bullet maturities (credit cards, auto dealer floorplans), average life is determined by the expected principal payment date. For amortizing ABS (auto retail loans and leases, student loans and SBA loans), average life is defined as the weighted average life to maturity based on the prepayment assumptions and market conventions listed below.