alleryStart learning →What flaw did the 2007-2008 crisis expose about loan originators?
AThey kept no residual risk
BThey held all of the risk
CThey refused to securitize
DThey set unusually high standards
Answer & Solution
Correct answer: A. They kept no residual risk
Originators kept no residual risk but collected substantial fees, which did not encourage better underwriting.
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