What roles do originators play in the securitization process

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Question 1: What evidence suggests to James that originate-to-distribute mortgage lenders relaxed lending standards and were less diligent in screening loan applicants? Why was this behavior especially profitable for loans that were to be securitized?

Question 2: What roles do originators, sponsors, and servicers play in the securitization process?

a. Who performs these roles in affiliated deals, mixed deals, and unaffiliated deals?

b. In which types of deal is moral hazard likely to be most and least severe? Why?

c. Do the evidence James presents confirm this hypothesis? In other words, does skin in the game matter? Explain.

Reference no: EM132656284

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