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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