Question

QUESTION 17

1. The addition of a future funding to an existing CRE CLO is intended to decrease the average life of the deal

   True

   False

10 points   

QUESTION 18

1. When loans in a CRE CLO pay off before their maturity, the overall financing becomes more expensive for the issuer

   True

   False

10 points   

QUESTION 19

1. When loans in a CRE CLO pay off before their maturity, the overall financing becomes less expensive for the issuer

   True

   False

Answer 1

17. The statement is true as addtion of the funding to existing CRE the average life of the CLO deal will reduce as we get more funds we can complete the work early then before therefore deal time will reduce.

18.The statement is false as if loans are paid before their maturity it will be beneficial as in future we do not need to pay off interset over the loan but we will be required to check that is there any penalty attached with the termination early.If penalty amount is more then interest over the life then the statement is correct otherwise statement is false.

19.The statement is true as if loans are paid before their maturity it will be beneficial as in future we do not need to pay off interset over the loan but we will be required to check that is there any penalty attached with the termination early.If penalty amount is more then interest over the life then the statement is false otherwise statement is true..