The process of packaging promissory notes and negotiating their sale to investors is called securitization.

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Securitization is the process of pooling various types of contractual debt such as residential mortgages, commercial mortgages, auto loans or credit card debt obligations, and selling their related cash flows to third-party investors as securities, which may be described as bonds, pass-through securities, or collateralized debt obligations (CDOs). This process involves packaging and selling promissory notes to investors, thereby converting illiquid assets into liquid securities that can be traded on the securities market.

The Process of Packaging Promissory Notes and Negotiating Their Sale