Sentences with word «securitizer»

That debt changed hands and was ultimately sold to investors through a company neither he nor his father had ever heard of: First Marblehead, once one of the biggest securitizers of private student loans.

[4] Scholar Michael Simkovic argues that this relaxation of standards was due to greater competition between securitizers for loans, and greater market power for loan originators.

The risk retention requirement for securitizers is worth noting.

Housing bubbles create tail risks, leading Bubb and Krishnamurthy to conclude that imposing greater housing risks on securitizers will be an ineffective and even counterproductive approach to reducing overall «systemic risk» during bubbles.

Both the risk - retention requirement and the ability - to - repay rule are premised on lenders and securitizers determining their own risks rationally.

One key measure was the Dodd - Frank Act, which in part seeks to alter the incentives of sophisticated mortgage lenders and securitizers so they stop exploiting less sophisticated mortgage borrowers and investors.

The law's risk retention requirement mandates that mortgage securitizers must bear at least five percent of the credit risk of any assets securitized.

According to Bubb and Krishnamurthy, two measures in particular aim to «[protect] naïve investors and borrowers from opportunistic securitizers and predatory lenders.»

Securitizers package these loans into bonds and sell them to you, the investor.

And it has been alleged that the pair eased guidelines to stay relevant in the mortgage market, largely because they were publicly traded companies steadily losing market share to private - label securitizers.

[4] Financial journalists Bethany McLean and Joe Nocera argue that Wall Street securitizers encouraged relaxation of standards because poor - quality loans «meant higher yields».

On March 26, 2012, Reps. Bachus (R - AL) and Garrett (R - NJ) issued a letter expressing concern to six banking agencies regarding their risk retention proposal, which contained a requirement that securitizers set aside the profits from sales of securities in a «premium capture cash reserve accounts» (PCCRAs).

According to Vaccaro, a CMBS securitizer typically earned margins between 3 % and 5 % in 1997.

Critics have suggested that the complexity inherent in mortgage securitization can limit investors» ability to monitor risk, and that competitive mortgage securitization markets with multiple securitizers may be particularly prone to sharp declines in underwriting standards as lenders reach for revenue and market share.

Although the federal government has not pursued criminal prosecutions of bankers at the heart of the mortgage operations that collapsed in 2007, it has stepped up civil lawsuits against the largest originators and securitizers of home loans during the boom.

[26] The worst loans were originated in 2004 — 2007, the years of the most intense competition between securitizers and the lowest market share for the GSEs.

The authors, however, assert that bubbles can lead to too - high expectations about future housing, which will prevent mortgage lenders and securitizers from making optimal decisions.

However, as market power shifted from securitizers to originators and as intense competition from private securitizers undermined GSE power, mortgage standards declined and risky loans proliferated.

It multiplied the number of actors connected to a single mortgage (including mortgage brokers, specialized originators, the securitizers and their due diligence firms, managing agents and trading desks, and finally investors, insurances and providers of repo funding).

A report to Congress from the Fed noted that «by retaining a portion of the credit risk, the securitizer and / or originator will have an incentive to exercise due care.»

Theoretically, if a securitizer has skin in the game, more attention will be paid to the credit characteristics of the underlying collateral.

Dodd - Frank generally requires that a securitizer of asset - backed securities (ABS) retain an economic interest in not less than 5 percent of the credit risk of the assets collateralizing such ABS.

Just about all of these gave the securitizer / repackager the right to return the loans within 6 (or 12) months if they went into default.

This includes by addressing various compensation relationships that may arise between any lender, guarantor, servicer, securitizer of a Loan, or any industry, trade or professional association or other entity that receives money related to Loan activities from any such lender, guarantor, servicer, or securitizer (collectively, «Lender (s)»), and either The Cooper Union itself, or any Personnel.

And, according to Commercial Mortgage Alert, the newsletter that tracks CMBS activity, Lehman was the third largest conduit securitizer in 1997 with $ 1.882 billion in deals and the second largest conduit / large loan program securitizer with $ 3.308 billion.