Securitization has decreased the supply of credit to homeowners and increased the cost of borrowing.

Question

Quizplus · Accepted Answer

Securitization has actually increased the supply of credit to homeowners by allowing mortgage lenders to sell their loans to investors, freeing up capital to make more loans. However, securitization can increase the cost of borrowing due to fees associated with the process and the demand from investors for higher yields on mortgage-backed securities.

Securitization Has Decreased the Supply of Credit to Homeowners and Increased