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    Prepayment risk & collateralized mortgage obligations

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    What is prepayment risk and how does it apply to collateralized mortgage obligations and other forms of securitized mortgages?

    What innovations has the mortgage lending industry developed to deal with prepayment risk?

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    https://brainmass.com/business/finance/prepayment-risk-collateralized-mortgage-obligations-373745

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    Prepayment risk occurs when a loan or a bond is paid off or cashed out before the maturity date. This is due to the fact that loans ...

    Solution Summary

    What is prepayment risk and how does it apply to collateralized mortgage obligations and other forms of securitized mortgages?

    What innovations has the mortgage lending industry developed to deal with prepayment risk?

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