Capstead pledges its Residential mortgage investments as collateral for secured borrowings primarily in the form of repurchase arrangements with commercial banks and other financial institutions. Repurchase arrangements entered into by the Company involve the sale and a simultaneous agreement to repurchase the transferred assets at a future date and are accounted for as financings. The Company maintains the beneficial interest in the specific securities pledged during the term of each repurchase arrangement and receives the related principal and interest payments.

The terms and conditions of secured borrowings are negotiated on a transaction-by-transaction basis when each such borrowing is initiated or renewed. The amount borrowed is generally equal to the fair value of the securities pledged, as determined by the lending counterparty, less an agreed-upon discount, referred to as a “haircut.” Interest rates are generally fixed based on prevailing rates corresponding to the terms of the borrowings. Interest may be paid monthly or at the termination of a borrowing at which time the Company may enter into a new borrowing at prevailing haircuts and rates with the same lending counterparty or repay that counterparty and negotiate financing with a different lending counterparty. None of the Company’s lending counterparties are obligated to renew or otherwise enter into new borrowings at the conclusion of existing borrowings. In response to declines in fair value of pledged securities due to changes in market conditions or the publishing of monthly security pay-down factors, lending counterparties typically require the Company to post additional securities as collateral, pay down borrowings or fund cash margin accounts with the counterparties in order to re-establish the agreed-upon collateral requirements. These actions are referred to as margin calls. Conversely, in response to increases in fair value of pledged securities, the Company routinely margin calls its lending counterparties in order to have previously pledged collateral returned.

Secured borrowings (and related pledged collateral, including accrued interest receivable), classified by collateral type and remaining maturities, and related weighted average borrowing rates as of the indicated dates were as follows (dollars in thousands):

Collateral Type	Collateral Carrying Amount		Accrued Interest Receivable		Borrowings Outstanding		Average Borrowing Rates
December 31, 2019
Borrowings under repurchase arrangements secured by Agency securities with maturities of 30 days or less	$	9,484,275	$	27,826	$	9,002,527		2.12	%
Borrowings under repurchase arrangements secured by Agency securities with maturities of 31 to 90 days		1,344,437		3,742		1,271,971		1.98
Similar borrowings secured by collateral for structured financings		915	–			915		7.99
	$	10,829,627	$	31,568	$	10,275,413		2.10

December 31, 2018
Borrowings under repurchase arrangements secured by Agency securities with maturities of 30 days or less	$	4,424,311	$	12,287	$	4,204,988		2.73	%
Borrowings under repurchase arrangements secured by Agency securities with maturities of 31 to 90 days		7,143,129		19,621		6,773,366		2.68
Similar borrowings secured by collateral for structured financings		1,008	–			1,008		7.99
	$	11,568,448	$	31,908	$	10,979,362		2.70

Average secured borrowings outstanding were $10.8 billion and $11.9 billion during 2019 and 2018, respectively. Average secured borrowings outstanding differed from respective year-end balances during the indicated periods primarily due to changes in portfolio levels and differences in the timing of portfolio acquisitions relative to portfolio runoff. Interest paid on Secured borrowings, including related Derivative cash flows, totaled $232.3 million, $213.8 million, $136.1 million and million during 2019, 2018, and 2017, respectively.