conduit

  

Definition

A financial entity that purchases mortgage-backed securities from a third party to resell to investors with new terms that will make the sale profitable for the issuing entity. The conduit will usually pool enough funds from the mortgage-back securities before reissuing the funds to another party. A conduit may be used if a borrower is unable to meet the requirements of the original lender. See also conduit borrower, conduit issuer.

Use conduit in a sentence

  • The water was leaking, so I figured that there must be some kind of problem with a conduit that was causing the leak.

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  • You may need to use a conduit to get your hands on something you need and they will charge a small fee.

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  • The conduit was necessary in the project because we needed multiple intermediaries to facilitate our optimal investing portfolio and transactions.

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