what are the mechanics of an spv 
the spv itself acts as an affiliate of a parent corporation that sells assets off of its own balance sheet to the spv the spv becomes an indirect source of financing for the original corporation by attracting independent equity investors to help purchase debt obligations this is most useful for large credit risk items such as subprime mortgage loans not all spvs are structured the same way spvs are often limited liability companies llcs in the united states the llc normally groups the assets into tranches and sells them to meet the specific credit risk preferences of investors after it purchases the risky assets from the parent company 