What is Residential Mortgage-Backed Security ?

987 reads · Last updated: December 5, 2024

Residential mortgage-backed securities (RMBS) are debt-based assets backed by the interest paid on residential loans. Mortgages and home-equity loans have a comparatively low rate of default and a high rate of interest since there is a high demand for the ownership of a personal or family residence. Investor risk is mitigated by pooling many of these loans to minimize the risk of default.

Suggested for You

Refresh