An asset swaption in which the buyer pays fixed and receives floating, while the seller, of course, pays floating and receives fixed. This asset swaption involves the exchange of an agreed reference rate and the rate on an asset underlying the swap. For example, a bank holding fixed-income securities or fixed-rate mortgages and expecting lower medium-term interest rates can take a long position in a payer asset swaption (i.e., buys a payer asset swaption).

The opposite of a payer asset swaption is a receiver asset swaption.

This swaption is also called a pay-fixed asset swaption.