Prepayment risk was forefront in the minds of many home-equity ABS investors in 2002, given the refinancing wave that maintained momentum throughout the year. With this as a backdrop, underwriter Banc One Capital Markets and issuer GMAC Mortgage created a revolving-trust, bullet-paying home equity structure - GMAC Mortgage 2002-HE-3 - that could ostensibly shield investors from the

prepayment risk inherent to traditional home equity transactions. In addition to attracting home equity players, the deal lured buyers from the broad base of credit card investors into the mortgage sector - a migration that became evident in yield spreads.

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