A security that passes through payments from debtors to investors. Packages of loans are assembled and sold to investors by private lenders. Although pass-through securities have stated maturities, the actual lives of the securities are likely to be shorter, especially during periods of falling interest rates, when borrowers pay off mortgages early. The security derives its name from the fact that interest and principal payments made by borrowers are passed through monthly after deduction of a service fee. Also called pass through. See also Ginnie Mae pass through, production rate 2.