Originally published by CU Business .
High performing institutions understand the importance of evaluating all asset classes when constructing their balance sheets, including whole loans. No different from a securities investment or loan origination, incorporating the secondary whole loan market into balance sheet strategy can often improve institutional performance. In this article we’ll dive into the relative value in the whole loan and participation space as well as drivers of deal value and marketability.
Collateral Characteristics The most direct driver of a loan pool’s price is the characteristics of the collateral itself. These include:
Coupon (WAC) Credit quality Weighted average maturity (WAM) Servicing type View Publication
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The content in this article is provided for informational purposes and should not be relied upon as recommendations or financial planning advice. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues. While such information is believed to be reliable, no representation or warranty is made concerning the accuracy of any information presented. Statements herein that reflect projections or expectations of future financial or economic performance are forward-looking statements. Such “forward-looking” statements are based on various assumptions, which assumptions may not prove to be correct. Accordingly, there can be no assurance that such assumptions and statements will accurately predict future events or actual performance. No representation or warranty can be given that the estimates, opinions or assumptions made herein will prove to be accurate. Actual results for any period may or may not approximate such forward-looking statements. No representations or warranties whatsoever are made by ALM First Financial Advisors as to the future profitability of investments recommended by ALM First Financial Advisors.
