easy · Asset-Backed Securities asset-nuances

What does the lender typically receive?

1. The present value of the interest that would have been earned if the loan had not prepaid.
2. The immediate right to foreclose on the underlying property as soon as prepayment occurs.
3. A flat, pre-negotiated fee equal to roughly 1% of the loan's outstanding principal balance.
4. A permanently higher interest rate applied to the remaining loans still held within the pool.

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