July 2008
Beginner
384 pages
9h 52m
English
Content preview from Introduction to Securitization
Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
O’Reilly covers everything we've got, with content to help us build a world-class technology community, upgrade the capabilities and competencies of our teams, and improve overall team performance as well as their engagement.I wanted to learn C and C++, but it didn't click for me until I picked up an O'Reilly book. When I went on the O’Reilly platform, I was astonished to find all the books there, plus live events and sandboxes so you could play around with the technology.I’ve been on the O’Reilly platform for more than eight years. I use a couple of learning platforms, but I'm on O'Reilly more than anybody else. When you're there, you start learning. I'm never disappointed.I'm always learning. So when I got on to O'Reilly, I was like a kid in a candy store. There are playlists. There are answers. There's on-demand training. It's worth its weight in gold, in terms of what it allows me to do.
SELECTION OF THE ASSETS
Once the type of assets to be securitized is determined, the selection of the specific assets in the pool must be made. To do so, selection criteria are established. One essential criterion in selecting assets is the assembling of an asset pool so as to provide a balanced spread of constituents with maximum possible diversity. For example, in the selection of the loans for a residential mortgage-backed securities, geographical diversification of the properties is sought. This criterion is an important factor used by rating agencies in determining the amount of credit support for a securitization transaction.
Other selection criteria are the amount of seasoning of the assets (the amount of time since origination), the current performance of the assets (performing versus nonperforming assets), and historical performance. It is typically preferable to have a seasoned pool rather than a newly originated pool, currently performing assets, and assets with no overdue balances or more than a certain number of overdue days. The assets selected for the pool should have the same average characteristics of the pool. Significant deviations of assets selected from the average defining features of the pool quality are not ideal.
Depending on the collateral type, detailed selection criteria such as loan-to-value (LTV) ratio, debt-to-income ratio, property type, and the like are laid down.
Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
and much more.
Read now
Unlock full access
More than 5,000 organizations count on O’Reilly
O’Reilly covers everything we've got, with content to help us build a world-class technology community, upgrade the capabilities and competencies of our teams, and improve overall team performance as well as their engagement.Julian F.
I wanted to learn C and C++, but it didn't click for me until I picked up an O'Reilly book. When I went on the O’Reilly platform, I was astonished to find all the books there, plus live events and sandboxes so you could play around with the technology.Addison B.
I’ve been on the O’Reilly platform for more than eight years. I use a couple of learning platforms, but I'm on O'Reilly more than anybody else. When you're there, you start learning. I'm never disappointed.Amir M.
I'm always learning. So when I got on to O'Reilly, I was like a kid in a candy store. There are playlists. There are answers. There's on-demand training. It's worth its weight in gold, in terms of what it allows me to do.