Mortgage-backed security

Mortgage Backed Securities ( for secured mortgage backed securities english) are secured bonds, ie asset-backed securities whose cash flows are supported by the principal and interest payments of a pool of mortgages secured claims. Unlike mortgage bonds they do not appear in the balance sheet of the originator location (such as a bank ), as these ( a special purpose entity ) transmits the pool of opaque assets to implement the securitization of the issuer.

CMBS

Commercial MBS ( CMBS) are secured by commercial and multi-family properties (such as apartment complexes, retail or office buildings). The characteristics of these loans vary. While the longer-term loans (5 years or longer) often have fixed interest rates and restrictions on early repayments, there are short-term loans (1-3 years) usually with a variable interest rate and prepayment free.

Since mortgagors can prepay, the cash flows are not known in advance and can only be estimated. This early redemption is known as prepayment and poses a risk to MBS investors dar.

RMBS

In contrast to commercial MBS ( CMBS) are secured by residential properties residential MBS ( RMBS).

The MBS market

The total market value of all outstanding U.S. MBS at the end of the first quarter of 2007 was approximately 4.1 trillion ( U.S.: Trillions ) USD. This is significantly more than the market value of all other asset-backed securities open. The MBS market, surpassing since 2000, the market for U.S. Treasury notes and bonds.

The issue volume of the three major issuers GNMA, FNMA, FHLMC, and in recent years were as follows:

  • 2006: 899 billion USD
  • 2005: 967 billion USD
  • 2004: 1,019 billion USD
  • 2003: 2,131 billion USD
  • 2002: 1,444 billion USD
  • 2001: 1,093 billion USD
Bond (finance) Government National Mortgage Association Fannie Mae
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