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What Is Securitization?

By Kristi Waterworth – Updated Nov 22, 2024 at 11:18AM

Key Points

  • Securitization turns hard-to-sell assets into liquid securities, like mortgage-backed securities.
  • Investors can buy bundles of these securities, which vary in risk and potential return.
  • Banks securitize assets to free capital for more loans, aiding community and cash flow.
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