The process of pooling assets together and selling bonds off of their joint income streams is a process known as securitization.

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Securitization is the financial practice 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).

The Process of Pooling Assets Together and Selling Bonds Off