This is the eighth of 10 articles taking an updated look at our most widely read stories of the year. The first seven can be found here:Europe, Cat Bonds, Marketplace, Risk Sharing, FFELP, Solar, CMBS.
Reimbursement rights to the money that mortgage servicers advance bondholders once held promise as an alternative form of exposure to housing. Servicing mortgages, especially nonperforming ones, is a capital intensive business; it can months, and sometimes years, to get repaid for advancing interest and principal payments on delinquent loans. Unlike the banks that traditionally dominated this business could rely on deposits for cheap funding, new players need access to the capital markets.