Since the investors take on the risk of the asset pool rather than the originator, an external credit rating plays an Important role. The rating process would assess the strength of the cash flow and the mechanism signed to ensure full and timely payment by the process of selection of loans of appropriate credit quality, the extent of credit and liquidity support provided and the strength of the legal framework.
Administrator or Servicer
It collects the payment due from the obligors and passes it to the SPY, follows up with delinquent borrowers and pursues legal remedies available against the defaulting borrowers. Since it receives the instalments and pays it to the SPY; it is also called the Receiving and Paying Agent (RPA).
Agent and Trustee
It accepts the responsibility for overseeing that all the parties to the securitisation perform in accordance with the securitisation trust agreement. Basically, it is appointed to look after the interest of the investors.