Prepay

To prepay is to expend funds in advance of the delivery of goods or services. A prepayment typically arises when the buyer cannot obtain credit from the seller, or when the buyer has ordered custom goods that the seller will not otherwise be able to sell if the buyer does not pay for the goods. The level of prepayments tends to rise during a down economy, as businesses contract the amount of credit offered to customers. The reverse situation occurs when an economy is expanding.