Phrases with «mortgage securitization»

Mortgage securitization is when a bank or financial institution bundles together many individual mortgages and sells them as a single investment product to investors. This allows the bank to get cash upfront to lend out to new borrowers. The investors then earn a return on their investment through the interest payments made by the homeowners who took out the mortgages. Full definition

Sentences with «mortgage securitization»

  • Negative Convexity: Through late 1993, structurers of residential mortgage securities were very creative, making tranches in mortgage securitizations that bore a disproportionate amount of risk, particularly compared to the yield received. (alephblog.com)
  • They point out an important feature of mortgage securitization: its «tail risk» — the risk that a loan will greatly underperform on its expectations. (bloomberg.com)
  • The private mortgage securitization market continued to grow. (en.wikipedia.org)
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