Asset-Backed-Security's and profit?
So lets say there's a borrower, he borrows $500,000. The lender agrees to give him the sum and then that becomes a loan. After that the borrower eventually can pay back the loan with interest. Now lets say the lender wants to sell this loan. How does he sell it? Lets say the payback was $510,000 with interest. If he tries to sell his loan to an investor and prices it higher (to make a profit) the investor won't buy it. However if he prices it under he will make a loss. If he prices it the exact price then no one makes anything! Im so confused help! So can anyone explain how Asset Backed Security's or mortgage backed securities work?
Thanks.