prepay

verb
pre·​pay | \ (ˌ)prē-ˈpā How to pronounce prepay (audio) \
prepaid\ (ˌ)prē-​ˈpād How to pronounce prepaid (audio) \; prepaying

Definition of prepay

transitive verb

: to pay or pay the charge on in advance

Keep scrolling for more

Other Words from prepay

prepayment \ (ˌ)prē-​ˈpā-​mənt How to pronounce prepayment (audio) \ noun

Examples of prepay in a Sentence

Special orders must be prepaid.
Recent Examples on the Web Brink’s prepaid its manufacturers and didn’t haggle much about the price. Nina Trentmann, WSJ, "Brink’s Adds Masks and Gloves to Protection Plans," 13 May 2020 Airlines started 2020 optimistic about travel demand, with a few boosting bag fees by $5, to $35 for the first bag and $45 for the second bag for travelers who pay at the airport instead of prepaying online. Dawn Gilbertson, USA TODAY, "The $8.6 billion question: What will happen to airline fees after coronavirus pandemic?," 4 May 2020 In order to shorten the check-in process and reduce risk to employees and customers, the ACGT announced that singles can now book tee times on-line and that on-line tee times can be prepaid using a credit or debit card. Tom Orsborn, ExpressNews.com, "Golf exempt from city, county stay-at-home coronavirus order," 24 Mar. 2020 But some shoppers are prepaying and driving to the farm, then waiting safely in their car with the trunk popped open, while the food is dispatched. Tejal Rao, New York Times, "As Supermarkets Feel Hazardous and Sparse, Small Farms Deliver," 3 Apr. 2020 The market encourages preordering and prepaying with vendors directly to expedite the process. Arizona Republic, "These metro Phoenix farmers markets are open during the coronavirus pandemic," 27 Mar. 2020 Other states could follow suit for primaries and the general, and Congress could help by providing funding for all states to prepay postage. Gilad Edelman, Wired, "Despite Coronavirus, Washington Isn't Worried About Its Primary," 10 Mar. 2020 As part of the deal, Dish will get Sprint’s prepaid Boost Mobile customers. Washington Post, "AP Explains: What T-Mobile takeover of Sprint means for you," 11 Feb. 2020 New this year, guests can prepay for parking in University Circle’s Ford Road Garage using the Parkmobile app. Laura Demarco, cleveland, "University Circle announces details of 26th annual Holiday CircleFest," 19 Nov. 2019

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'prepay.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

See More

First Known Use of prepay

1839, in the meaning defined above

Keep scrolling for more

Learn More about prepay

Time Traveler for prepay

Time Traveler

The first known use of prepay was in 1839

See more words from the same year

Statistics for prepay

Last Updated

23 May 2020

Cite this Entry

“Prepay.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/prepay. Accessed 31 May. 2020.

Keep scrolling for more

More Definitions for prepay

prepayment

noun

Financial Definition of prepayment

What It Is

Prepayment occurs when a borrower pays off a loan earlier than expected.

How It Works

For example, let's say that John Doe borrows $300,000 to buy a house in Phoenix. The loan is a 30-year mortgage at 5% interest. John lives in the house for five years and makes his payments on time every month. However, in year six, he gets a job offer in Philadelphia and decides to move there. Accordingly, he sells his house. At the closing, the buyer gives John $500,000 for his house. John uses $250,000 to pay off the remaining balance on the loan instead of making 25 more years of payments. John has prepaid the loan.

Why It Matters

When a borrower prepays a loan, the borrower saves a lot of interest. But that means the lender also misses out on all that interest. Accordingly, prepayment can sometimes come with a penalty, and this is disclosed in the loan documents.

People who invest in pass-through securities are also frequently concerned about prepayment. That's because those securities that receive payments from an intermediary that collects payments from a pool of assets. The most famous of these is mortgage-backed securities (MBS), which represent an interest in a pool of mortgage loans.

When people move, as we’ve seen, they sell their houses, payoff their mortgages with the proceeds, and buy new houses with new mortgages. When interest rates fall, many homeowners refinance their mortgages, meaning they obtain new, lower-rate mortgages and pay off their higher-rate mortgages with the proceeds. This means the lenders and the MBS investors miss out on interest income due to prepayment.

Source: Investing Answers

prepay

verb
How to pronounce prepay (audio)

English Language Learners Definition of prepay

: to pay for (something) before you receive or use it
: to pay (something) before you are required to pay it

prepay

verb
pre·​pay | \ ˈprē-ˈpā How to pronounce prepay (audio) \
prepaid\ -​ˈpād \; prepaying

Kids Definition of prepay

: to pay or pay for beforehand prepay the bill

Keep scrolling for more

pre·​pay | \ prē-ˈpā How to pronounce prepay (audio) \
prepaid; prepaying

Legal Definition of prepay

: to pay or pay the charge on in advance (as of date due or maturity date) no penalty for prepaying your student loan

Other Words from prepay

prepayment noun

Keep scrolling for more

More from Merriam-Webster on prepay

Thesaurus: All synonyms and antonyms for prepay

Rhyming Dictionary: Words that rhyme with prepay

Spanish Central: Translation of prepay

Nglish: Translation of prepay for Spanish Speakers

Comments on prepay

What made you want to look up prepay? Please tell us where you read or heard it (including the quote, if possible).

WORD OF THE DAY

See Definitions and Examples »

Get Word of the Day daily email!

Test Your Vocabulary

May 2020 Words of the Day Quiz

  • a blooming wisteria tree
  • Which is a synonym of exiguous?
Spell It

Can you spell these 10 commonly misspelled words?

TAKE THE QUIZ
Dictionary Devil

Test Your Knowledge - and learn some interesting things along the way.

TAKE THE QUIZ
Love words? Need even more definitions?

Subscribe to America's largest dictionary and get thousands more definitions and advanced search—ad free!