Understanding Collateralized Mortgage Obligations

Thursday, January 1st, 1987 at 12:00 am by Thomas A. Kasper & Les Parker
Thomas A. Kasper & Les Parker, Understanding Collateralized Mortgage Obligations, 1987 Colum. Bus. L. Rev. 139

Since first introduced by the Federal Home Loan Mortgage Corporation (“FHLMC”) in June 1983, Collateralized Mortgage Obligations (“CMO’s”) have created the most efficient security structure to date for distributing mortgage cash flow to investors. Since the first issue, now almost four years ago, more than $60 billion of CMO’s have been issued by a variety of institutions. Besides FHLMC, investment bankers, homebuilders, thrifts, mortgage bankers, insurance companies, and Real Estate Investment Trusts (“REIT’s”) have issued CMO’s for a variety of reasons.

Author Information

Mr. Kasper is a principal with Morgan Stanley & Co. Incorporated, in New York City. Mr. Kasper joined Morgan Stanley to start the Mortgage Finance Group. He is now responsible for new business development, integration of mortgage and real estate financing with other parts of the firm, and training personnel in mortgage securities. Mr. Parker, CMB, is Vice President and Chief Operating Officer of 1st State Mortgage & Financial Corporation in Austin, Texas.