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In Veronesi's Fixed Income Securities book it is written:

Summers are characterized by large prepayments, as this is the period in which people move from one place to another for various reasons.

But why the fact of moving from one place to another will trigger prepayment?

  • 3
    Maybe he meant that people are paying off their mortgages because they sell the house. – void_ptr Aug 23 at 0:40
  • @void_ptr Yes it seems like a good explanation for me – Victor Aug 23 at 0:47
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"prepayments" in the mortgage world include when a mortgage is either refinanced or paid off when a house is sold. Since financially the effect is the same, there's no distinction made between "extra" payments and payoffs.

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