Mortgage-backed securities became a significant issue because

Question

Quizplus · Accepted Answer

I: Subprime mortgages were bundled together and sold as mortgage-backed securities. These securities caused a significant impact during the financial crisis of 2008 as many borrowers defaulted on their mortgages, leading to huge losses for investors.

II: The complexity of mortgage-backed securities made it difficult for investors to accurately assess the risks associated with them, which contributed to the widespread use of fraudulent and unethical practices in the creation and marketing of these securities.

Mortgage-Backed Securities Became a Significant Issue Because