The document discusses various asset types common to securitization, including auto loans, student loans, and credit card receivables. It explains how these assets are bundled and sold as securities to investors, who receive payments from the underlying assets. Each asset category has unique characteristics and risk profiles, affecting potential returns on investment.

1. ASSET TYPES
COMMON TO
SECURITISATION
D o m e n Z a v r l

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As well as mortgages, some of the asset types most
common to securitisation include auto loans, student
loans and credit card receivables.

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AUTO LOANS
Car financing is a common category of asset-
backed securities. Like mortgages, auto loans
are bundled together and split into different
groups with varying risk profiles before being
sold to investors as securities. These securities
owners inherit payments connected to these
assets, including principal payments and
monthly interest payments.
STUDENT LOANS
Funds that students borrow to attend college
are regularly packaged into asset-backed
securities. Investments can be made in either
student loans handed out by the government
or loans from private sources, like banks. The
latter tend to offer a potentially larger return
but come with a slightly higher risk.
CREDIT CARD RECEIVABLES
Stakes can also be bought in money owed on
credit card balances. These kinds of asset-
backed securities do not incorporate fixed
payment amounts, and when balances are
paid off new loans (and other changes) can be
added to the pool. Returns are in the form of
annual fees, interest and principal payments.
Funds that students borrow to attend college are regularly
packaged into asset-backed securities. Investments can be made
in either student loans handed out by the government or loans
from private sources, like banks.

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