When a Mortgage Is Used as Collateral for the Issuance

question 18

Multiple Choice

When a mortgage is used as collateral for the issuance of a mortgage-backed security (MBS) , the underlying mortgage is said to be "securitized." Approximately what percentage of conventional conforming and FHA or VA loans in the U.S. are being sold into the secondary market and being used as collateral for the issuance of MBS?

• A) 25%
• B) 50%
• C) 90%
• D) 100%

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Definitions:

Long-Lasting

Continuing or enduring for an extended period of time without significant deterioration or loss of quality.

Temporary Activation

A state or condition of being enabled or made active for a limited period.

Temporary

Lasting for a limited period of time; not permanent or enduring.

Physiological

Related to the functions and activities of living organisms and their parts, including all physical and chemical processes.