If a mortgage-backed bond is issued as a fully modified pass-through security, it means that: a. b.
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If a mortgage-backed bond is issued as a fully modified pass-through security, it means that:
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a. b. c. P d. bondholders will receive full and timely payment of principal and interest even if underlying mortgage payments are not made. the bond has been structured to include both conforming and nonconforming loans. the interest rates on the underlying mortgages have been altered so that they equal the weighted-average coupon on the bond. the security carries a balloon payment to ensure that the bond is fully amortized in a set time frame (12 to 15 years).
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