A particular mortgage pool has a balance of $65 million and is scheduled to receive $108 thousand of planned principal payments in a month. If the CPR is 10%, the number of dollars of prepayments in that month is closest to:
A. $568,205
B. $10,800
C. $567,261
D. $650,000 - ANS C. $56...
A particular mortgage pool has a balance of $65 million and is scheduled to receive $108
thousand of planned principal payments in a month. If the CPR is 10%, the number of dollars of
prepayments in that month is closest to:
A. $568,205
B. $10,800
C. $567,261
D. $650,000 - ANS C. $567,261
Which of the following is NOT a form of credit enhancement commonly found on a private-label
mortgage-backed security whose mortgage pool consists of subprime loans?
A. Government insurance from federal mortgage bond insurance corporation
B. Overcollateralization
C. Price Mortgage Insurance (PMI)
D. Excess Spread
E. Senior / Subordinate tranche structure - ANS A. Government insurance from federal
mortgage bond insurance corporation
You are examining a particular mortgage backed pass through security that is selling for 100.
You project the following cash flows:
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