RMBS

See: Residential Mortgage Backed Securities

Residential Mortgage-Backed Security

A derivative whose value is derived from home equity loans and mortgages on properties where people live. As with all mortgage-backed securities, this entitles the owner to a claim on the principal and interest payments on the particular mortgages underpinning the security. MBS's pay an interest rate that is usually related to the interest rates the homeowners are paying on their mortgages. The equivalent of the coupon on a mortgage backed security is a percentage of the interest and principal paid on the mortgages backing the security. An obvious risk to a residential MBS is the possibility that interest rates on home loans may decline, causing homeowners to refinance their mortgages and deprive the holder of the security from future interest payments.

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Residential mortgage backed securities

References in periodicals archive ?

The performance of the Irish and Greek RMBS markets continued to deteriorate over the past year, it added.

EMEA residential mortgage market down

CUNA Mutual said it relied on RBS's quantitative representations in deciding to purchase 15 certificates in the10 separate RMBS offerings.

CUNA Mutual vs. RBS

Rating migrations are still expected, especially on the 492 tranches currently on review for downgrade and which include significant exposures to Spanish and UK Non-conforming RMBS, ABS of SME and Spanish consumer loans," cautions Mr.