What is the most commonly bundled type of loan in among asset-backed bonds?
A) Automobile loans
B) Mortgages
C) Credit card receivables
D) None of these

Question

Quizplus · Accepted Answer

Mortgages are the most commonly bundled type of loan among asset-backed bonds. This is because the value of the underlying asset (the mortgaged property) is typically more stable than other types of assets, such as automobiles or credit card receivables, which are subject to depreciation and default risk. Furthermore, mortgages are often long-term loans with consistent payment schedules, making them attractive for securitization.

What Is the Most Commonly Bundled Type of Loan in Among