[Verse 1] When banks need money flowing free They bundle loans for all to see Mortgages packed in one big box But risks are mixed like different stocks So how do we sort the safe from wild? We slice them up, layer by layer styled [Chorus] Tranching makes the layers clear Senior, mezzanine, and junior here SOSE protects when trouble's near Subordination, Over-collateral Excess Spread and Surety's shield SOSE keeps the senior yield secured [Verse 2] Picture a cake with layers three The top slice gets paid first, you see Senior tranche sits safe on high Gets its money before others try If defaults come and losses grow The bottom layers take the blow [Chorus] Tranching makes the layers clear Senior, mezzanine, and junior here SOSE protects when trouble's near Subordination, Over-collateral Excess Spread and Surety's shield SOSE keeps the senior yield secured [Verse 3] Subordination's waterfall way Junior absorbs loss every day Over-collateral means more backing Extra assets when loans start lacking Excess spread's the extra rate Cushions losses before too late [Bridge] Surety bonds like insurance strong Promise payment when things go wrong Credit enhancement makes it right Transforms the risk from dark to bright Four protections working as one Senior safety's never done [Chorus] Tranching makes the layers clear Senior, mezzanine, and junior here SOSE protects when trouble's near Subordination, Over-collateral Excess Spread and Surety's shield SOSE keeps the senior yield secured [Outro] From risky loans to rated gold Enhancement makes securities sold Remember SOSE when markets shake Credit protection's what it takes
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