In some instances,banks sell loans and agree to give the loan purchaser recourse to the seller for all or a portion of those loans that become delinquent.In this case,the purchaser,in effect,gets a:
A) call option.
B) put option.
C) forward contract.
D) futures contract.
E) None of the options is correct.
Correct Answer:
Verified
Q52: By agreeing to service any assets that
Q53: Loan-backed securities,which closely resemble traditional bonds,carry various
Q54: The advantage of a credit swap is
Q55: Loan sales are generally viewed as a
Q56: Securitized assets carry a unique form of
Q58: Securitization of loans can easily be applied
Q59: The party for whom a standby credit
Q60: When a bank issues a standby credit
Q61: A financial institution plans to issue a
Q62: The principal sellers of risk protection via
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents