Why is the entity seeking to raise funds through a securitization referred to as the "seller" or the "originator"?
What will be an ideal response?
A security created by pooling loans other than mortgage loans is referred to as an asset-backed security (ABS). To explain why an entity seeking to raise funds through a securitization is the "seller" or "originator" let us use an illustration. Suppose that Exception Dental Equipment, Inc. (EDE) has a bulk of its sales from installment contracts (wherein the buyer agrees to repay EDE over a specified period of time for the amount borrowed plus interest). The dental equipment purchased is the collateral for the loan. The credit department of EDE makes the decision as to whether or not to extend credit to a customer. EDE sets up a legal entity called a special purpose vehicle(SPV) to whom it sells its loans. Because EDE initiates the loan with the SPV, EDE is called the "seller" or "originator."
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A. reward B. sales skill level C. satisfaction D. motivation E. sales aptitude
Personal defenses are effective against all holders, whether or not the holder is a holder in due
course. Indicate whether the statement is true or false