What is Yield Maintenance?

Yield maintenance fee is also called "completion fee". Penalties collected from prepayment borrowers to maintain the lender's yield. Keep lenders neutral on the timing of early repayments; and make it uneconomic to refinance purely for lower mortgage rates. The simplest and most rigorous yield maintenance fee is a fee charged to the borrower based on the difference between the mortgage coupon rate and the current Treasury interest rate. ^[1]