The Journal of Real Estate Finance and Economics

, Volume 1, Issue 4, pp 331–346

Elements of mortgage securitization

  • Alan C. Hess
  • Clifford W. SmithJr.

DOI: 10.1007/BF00187071

Cite this article as:
Hess, A.C. & Smith, C.W. J Real Estate Finan Econ (1988) 1: 331. doi:10.1007/BF00187071


In this paper we review the forms of mortgage securitization, analyze the demand for securitization, and demonstrate how securitization meets these demands by reducing intermediation costs. We argue that the increased use of securitization is a response to increased interest rate volatility and represents a contractual innovation that facilitates an efficient allocation of risk-bearing among households and intermediaries.

Copyright information

© Kluwer Academic Publishers 1988

Authors and Affiliations

  • Alan C. Hess
    • 1
  • Clifford W. SmithJr.
    • 2
  1. 1.Graduate School of Business AdministrationUniversity of WashingtonWashingtonUSA
  2. 2.William E. Simon Graduate School of Business AdministrationUniversity of RochesterRochesterUSA

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