Type of security backed by mortgage cash flows and are packed by financial instruments is classified as
A. cash mortgage
B. securitized mortgage
C. financial mortgage
D. instrumental mortgage
Answer: Option B
Solution (By Examveda Team)
Type of security backed by mortgage cash flows and are packed by financial instruments is classified as securitized mortgage. Securitization is the procedure where an issuer designs a marketable financial instrument by merging or pooling various financial assets into one group. The issuer then sells this group of repackaged assets to investors. Securitization offers opportunities for investors and frees up capital for originators, both of which promote liquidity in the marketplace.This Question Belongs to Management >> International Finance And Treasury
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