A pipeline or mortgage pipeline describes mortgages that are in the process of being originated. Origination involves creating a loan (e.g., a mortgage loan) and selling it to another party against origination fees. This process (loan origination) usually gives rise to a derivative product of a specific type: a security or product that derives its performance (cash flows) from that of another (e.g., mortgage-backed securities, MBSs). While in the pipeline, mortgage brokers face the so-called pipeline risk.
Once closed, mortgages complete the origination process and are no more in the pipeline.
