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Basic Question 1 of 3

During the lockout period, the cash flow for a credit card receivable-backed security contains ______ collected from borrowers.

I. interest
II. fees
III. scheduled principal payments
IV. principal repayments

User Contributed Comments 3

User Comment
chessdude Principal is reinvested, that's what means "lockout".
cuban Borrowers can pay back principal along with interest. Its the investors who do not receive the principal payments during the lockout period.
StJohnDale Agreed
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I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz

Tamara Schultz

Learning Outcome Statements

describe types and characteristics of non-mortgage asset-backed securities, including the cash flows and risks of each type;

CFA® 2024 Level I Curriculum, Volume 4, Module 45.