A finance company issued an asset-backed security backed by home equity loans to individuals. The average interest
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A finance company issued an asset-backed security backed by home equity loans to individuals. The average interest rate on the loans is 9.7%. The fee for servicing the loans is 70 basis points. The finance company can issue an asset-backed security in which it pays 5.7%.
What is the net interest spread?
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Related Book For 
Financial Management And Analysis (Frank J. Fabozzi Series)
ISBN: 9780471477617
2nd Edition
Authors: Frank J. Fabozzi, Pamela P. Peterson
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