10-13.Rating agencies review the credit risk of the collateral of CMOs for all of the following except:

Question

Quizplus · Accepted Answer

Interest rates are not directly reviewed as part of the collateral's credit risk by rating agencies for Collateralized Mortgage Obligations (CMOs). Instead, they focus on factors directly related to the collateral itself, such as the type and location of the property, and the loan-to-value ratio, which provide a more direct measure of the risk associated with the underlying mortgages.

10-13Rating Agencies Review the Credit Risk of the Collateral of CMOs