Mortgage-Backed Securities: Securitization and Processing Introduction

In this article, we will learn about the Mortgage-Backed Securities, the Securitization process and Introduction to Securitization process . Though this article may not be covering the full minute details about entire Securitization process, but it will give you a clear introduction about the process and steps involved in the Securitization Process for Mortgage-Backed Securities. It will also talk about the various market participants, the types of Mortgage-Backed Securities, the models to be followed and related topics.

-- Participants in the Securitization and Processing of Mortgage-Backed Securities: Who all participate in the Securitization and Processing of Mortgage-Backed Securities? Here is the list of market and process participants
  -- Investors of Securitization Processing
  -- Originators in Securitization Processing: These are typically Banks, institutional investors, funding partners or Lenders
  -- Issuers: Something similar to the BRLM or Book running lead managers of a fresh issue. They are typically Agencies, Banks, Lenders
  -- Guarantor of Securitization Processing
  -- Dealers of Securitization Processing
  -- Servicers Organizations in Securitization Processing

-- Basic Mortgagle Facts about the Securitization and Processing of Mortgage-Backed Securities:
  -- Lien
  -- Amortization schedule
  -- Residential
  -- Commercial
  -- Characteristics of mortgages
  -- Types of mortgages
  -- Mortgage cash flows

-- Guarantees provided by the Government Sponsored Enterprise (GSE) in the Securitization and Processing of Mortgage-Backed Securities:
  -- Government National Mortgage Association
  -- Federal Home Loan Mortgage Corporation
  -- Federal National Mortgage Association

-- Fundamental Types of Mortgage Backed Securities: Basics of Mortgage Backed Securities
  -- Conforming
  -- Non-Conforming

-- Securitization Process Model in the Securitization and Processing of Mortgage-Backed Securities:
  -- Origination
  -- Securitization
  -- Secondary Market
  -- Investors
  -- Servicers
  -- Mortgage Rates versus MBS Coupon
  -- Cash Flows

-- Characteristics of the Mortgage Backed Securities:
  -- Types of mortgage pass-through securities
  -- Characteristics of pass-through securities
  -- Demographics
  -- Seasonal patterns
  -- Home sales
  -- Availability of money
  -- WAC - WAM - WALA
  -- Prepayments - PSA benchmark

-- An introduction to the MBS Marketplace (Securitization and Processing of Mortgage-Backed Securities):
  -- Over The Counter
  -- Trade Types
  -- Transaction Size
  -- Variance
  -- Settlement Periods

-- Process Lifecycle of a MBS Trade in the (Securitization and Processing of Mortgage-Backed Securities):
  -- Execution of Securitization Processing
  -- Risk Assesment and Management Process in Securitization Processing
  -- Trading and Allocation of capital and resources in Securitization Processing
  -- Settlement Processing of Securitization Processing