DEFINITION of 'Escrowed To Maturity'

The condition of a bond that has been repaid in advance by means of an escrow account, which holds the funds needed to pay the periodic coupon payments and the principal.

BREAKING DOWN 'Escrowed To Maturity'

The escrowed funds set aside for a company's debt obligations are usually invested in short-term debt securities - usually low-risk government bills - in order to protect the funds from inflationary depreciation.

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RELATED FAQS
  1. Who manages an escrow account?

    Managing an escrow account is a job for a trusted and experienced service provider. Discover the best personal finance solutions ... Read Answer >>
  2. How does the bank profit off of escrow accounts?

    Discover the truth behind escrow accounts and the bank's profits. Are these accounts worthwhile or just another way for the ... Read Answer >>
  3. Do FHA loans require escrow accounts?

    Here's why FHA mortgages require escrow accounts for property taxes, homeowners insurance and mortgage insurance premiums ... Read Answer >>
  4. What is the difference between yield to maturity and the coupon rate?

    Read about some of the basic differences between a debt security's coupon rate and its yield to maturity, and learn which ... Read Answer >>
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    When you buy a regular coupon bond, you are entitled to a coupon, which is typically paid at regular intervals, and the face ... Read Answer >>
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