To: Portfolio Lender, what if you can't sell MBS

[Carlos Ptriawan]

I have question this in my mind, this question if for the Portfolio/HML lender out there. We know PL (Portfolio Lender) doesn't sell your mortgage securities to FM, but you may sell to other private parties, like hedge funds,private funds,etc or keep it in the book. So my question is what happens if 80% of your portfolio is generated when ultra-low financing (sub 3% interest rate) is still available. If those are 30YFRM, does it mean you will lose money eventually, at least from an inflation standpoint ? Is there anyone willing to buy that outside FM?