When you take a loan, the bank can “sell” your loan to an investor. What does that process look like, and why would an investor want to buy loans?
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An investor might want to collect interest on those loans, but doesn’t want to deal with the hassle of selling the loan to you, maintaining the mortgage, accepting payments from you, dealing with phone calls from you, tracking you down if you stop paying, etc. The bank handles the administrative nonsense for a share of the interest, the investor fronts the money and takes the rest of the interest.
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