JPM Loans

Primary market

Where new securities are sold to investors. Loan is originated, underwritten, approved, and closed. Then Funds disbursed; loan added to lender’s books.

Secondary market

Where securities are traded after they have been issued in the primary market. Loan is sold or securitized (e.g., into MBS). Then investors trade loans or securities for liquidity and yield. Stock and bond markets are examples of secondary markets.

Initial Term Loan

initial, upfront lump sum of money provided to a borrower by a lender, where the borrower repays the principal and interest over a fixed period.

TLA

paid down in installments, often held by banks, shorter maturity, lower risk.

TLB

repayment at maturity, longer maturity, higher yield, syndicated to institutional investors like CLOs and loan funds.

Delayed Draw

Borrower doesn't receive full funding upfront. They can "draw" funds over a set period. Useful for acquisitions, capex projects, or staged financing. Commitments still accrue fees even if undrawn.

Investors

Buy securities like stocks and bonds to lend money to the issuer.

Issuer

Sell securities like stocks and bonds to raise capital.

P & L

summarizes a company’s revenues, costs, and expenses over a specific period to show whether the business made a profit or a loss. The cash flow statement starts with net income from the PNL and then adjusts it to show actual cash movement.

Fixed Income

They offer predictable cash flows and can serve as a diversification tool within an investment portfolio. Types include corporate bonds, treasury bonds, treasury securities

Leveraged Loans

Offers issuers the opportunity to raise long-term, low cost, prepayable debt . It's less risky, taps broader investor base, and used proceeds from debt offerings like: fund acquisitions, debt maturity, refinance existing debt

Syndicated Loan

collaborative financial arrangement provided by a group of lenders, known as a syndicate, to fund a single borrower, which might be a corporation, large project, or sovereign government.

Corporate Loan

a large sum of money borrowed by a company from a financial institution (like a bank) to fund operations, expansion, acquisitions, or manage cash flow. Usually for business purposes, often involves substantial amounts, rigorous underwriting, and can be secured by assets or unsecured, with varied terms and structures.

POL

detailed instructions on how to pay off your loan and the balance owing on your contract, along with the method for payment and any additional charges that may apply

Collateral

asset pledged as security for repayment of a loan, to be forfeited in the event of a default.

Margin call

Request for more collateral if exposure exceeds available margin.

Bond

A loan in exchange for interest payments. The issuer agrees to repay the original amount plus interest on the maturity date. Paid out in intervals and less risky. Help preserve capital.

Repo

Secured loans where the securities act as collateral. One party sells to another for cash. The party that sells agrees to buy back the same securities at a slightly higher price on a future date.

Option

Determined by 2 types. Calls which are the right to buy, and puts, which are the right to sell. A call is usually bought if you think the price of the asset will go up. A put is bought when you think the price of the asset will go down. This is all based on the strike price and it will be paid out by the expiration date.

FX Spot

This refers to the immediate exchange of currencies at current market prices, with settlement typically occurring within two business days.

CDS

one party pays a periodic fee (the "premium") in exchange for protection if a credit event (like default, bankruptcy, restructuring) occurs on a reference entity (a company, sovereign, etc.). Traders use CDS to hedge credit risk or to speculate on a company's creditworthiness.

Loan

sum of money is lent to another party in exchange for future repayment of the principal amount, generally with interest.

How loans are traded

originated in the primary market when a lender funds a borrower’s home purchase, and after closing it can be sold or pooled into securities in the secondary market where investors trade these loans through dealers and brokers.

Black Knight

widely used for loan origination and servicing. It centralizes loan data, ensures compliance, and integrates with agency delivery systems, which helps lenders streamline the secondary market process

HLMC Loan Selling Advisor (Freddie Mac).

Platform for pricing, contracting, and delivering loans. It ensures data accuracy and helps lenders complete the secondary market sale efficiently.

FNMA Loan Delivery (Fannie Mae).

It validates the data, identifies errors, and ensures the loan is eligible for sale or securitization.

GNMA SFPDM (Ginnie Mae – Single Family Pool Delivery Module)

It ensures government‑insured loans meet all requirements before securitization

Whole Loan Sale

The loan is sold individually.

MBS (Mortgage‑Backed Security)

Loans are pooled together and sold as a security.

Salability

Whether a loan meets investor requirements (Fannie, Freddie, Ginnie) and can be sold or securitized.

Investor Edits / Loan Quality Edits

Data issues flagged by the investor’s system (Loan Selling Advisor, Loan Delivery, SFPDM).

Pooling

Grouping loans into a mortgage‑backed security (MBS). Think of it like creating a “package” of loans for sale

Allocation

Assigning individual loans to specific pools or commitments.

Defect Remediation

Fixing data or documentation issues so the loan can be delivered.

Commitment / Pricing

The agreement to sell loans to an investor at a specific price.

ULDD (Uniform Loan Delivery Dataset)

Standardized data format required by Fannie/Freddie.

Repurchase Risk

If a loan is defective, the investor can force the lender to buy it back.

SOFR / Base Rate / Margin

Interest rate components used to calculate loan interest.

Agent

The bank responsible for coordinating the loan, communicating with lenders, and managing payments, notices, and amendments.

Lender of Record

The institution legally recognized as the lender on the loan. Important for settlements and assignments.

Assignment / Trade Settlement

The process of transferring loan ownership from one lender to another.

Funded

cash has been disbursed

Unfunded

commitments that haven’t been drawn yet

Accrued Interest

Interest that has accumulated but not yet been paid. Critical for settlement accuracy.

Breaks / Exceptions

Data mismatches between systems (Loan IQ, ClearPar, DTCC, internal books).

Upstream / Downstream Notices

Communications between agent banks and lenders regarding rate resets, paydowns, amendments, etc.

CUSIP / Facility ID / Deal ID

Identifiers used to track loans and facilities.

Borrower for syndicated loans

The corporation raising capital. They receive the loan proceeds and pay interest to the lenders.

Borrower in Mortgage Loans

The homeowner taking out the mortgage to buy or refinance a property. They make monthly payments of principal and interest.

Revolver

reusable line of credit that a borrower can draw, repay, and draw again, typically used for short‑term liquidity needs.

MTM

calculated by adjusting an asset's value to its current market price. Current market price x quantity (num of shares). For P/L its current - prior price x quantity

Coc

interest the seller earns because the buyer didn’t settle on time

Delayed comp

prevents either side from benefiting financially from intentionally delaying settlement

Underwriting

The lender’s risk‑assessment process to decide if a borrower qualifies for a loan and at what terms