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How is interest calculated for Secondary Market purchases?

For Secondary Market purchases, interest for the current payment period is divided proportionally between the seller and the buyer based on the number of days each party held the investment.

When a loan is purchased on the Secondary Market, interest for the current payment period is divided between the seller and the buyer on a pro-rata daily basis.

Example:

  • The loan pays interest on the 1st of each month.
  • The current interest period is 1 June – 1 July (30 days).
  • The buyer purchases the investment on 20 June.
  • The seller held the investment for the first 19 days of the period (1–19 June).
  • The buyer holds the investment for the remaining 11 days (20 June – 1 July).

As a result:

  • The seller receives 19/30 of the interest for the current payment period.
  • The buyer receives 11/30 of the interest for the same payment period.

From the next scheduled interest payment onwards, the buyer receives the full interest payment, provided the investment is still held at the time of the payment.