Irrational Call Option

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Definition: Irrational Call Option

Irrational Call Option
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Full Definition of Irrational Call Option

An option contained within a mortgage that allows borrowers to refinance when the prevailing mortgage rates fall to a certain level below the stated interest rate on the mortgage. So named because the behavior of borrowers in the application of the option seems to be unpredictable with many failing to exercise the option when it is to their benefit to do so.

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https://payrollheaven.com/define/irrational-call-option/
Modern Language Association (MLA):
Irrational Call Option. PayrollHeaven.com. Payroll & Accounting Heaven Ltd.
May 19, 2024 https://payrollheaven.com/define/irrational-call-option/.
Chicago Manual of Style (CMS):
Irrational Call Option. PayrollHeaven.com. Payroll & Accounting Heaven Ltd.
https://payrollheaven.com/define/irrational-call-option/ (accessed: May 19, 2024).
American Psychological Association (APA):
Irrational Call Option. PayrollHeaven.com. Retrieved May 19, 2024
, from PayrollHeaven.com website: https://payrollheaven.com/define/irrational-call-option/

Definition Sources

Definitions for Irrational Call Option are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 20th November, 2021 | 0 Views.