Savings and Loans and Risk. Traditionally, savings and loan institutions made loans only for home mortgages and held on to those mortgages. At one point, this was viewed as a safe way of doing...

Savings and Loans and Risk. Traditionally, savings and loan institutions made loans only for home mortgages and held on to those mortgages. At one point, this was viewed as a safe way of doing business. However, it became a risky way of doing business for U.S. savings and loans in the 1970s. Explain why making loans only for housing and holding on to the mortgages may be very risky. Why does this risk provide a rationale for securitization?