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Average Life

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Average Life

Also referred to as Weighted Average Life, or WAL, the average life of a mortage loan refers to the number of periods (commonly denoted in years) in which half the time-weighted principal has been paid.

Lenders use this metric in a variety of ways, including to price the loan (i.e. as part of the benchmark calculation to arrive at an appropriate interest rate) and to compare the risk of two loans of similar loan maturity.

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AdventuresinCRE.com (A.CRE) was started by Spencer Burton and Michael Belasco during their first year of graduate real estate studies at Cornell University. The site was initially meant to fill a need for readily available real estate financial modeling tools. Today, it is the web's preeminent real estate financial modeling, careers, and education resource.

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