The origination of a home mortgage loan is considered to be a .a.primary securit

ID: 2649056 • Letter: T

Question

The origination of a home mortgage loan is considered to be a

.a.primary security, because this is the FI's primary source of business.

b. secondary security, because mortgages are typically resold in the secondary market.

c. primary security, because the mortgage note is a newly created security.

d. secondary security if the sale is for an existing home and a primary security if it is for a new home.

e. derivative security because the value of the mortgage note depends on the underlying value of the home.

option C is correct.

home mortgage loan is a considered as a primary security, because they are newly created ones.

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