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Extension in an agency residential mortgage-backed security is most likely to result from:

A slower-than-expected prepayments.

An agency RMBS is said to extend when prepayments of the underlying mortgages are slower than expected. A decrease in interest rates would tend to accelerate prepayments, resulting in contraction. Agency RMBS are not typically structured with tranches.
Exhaustion of a support tranche is a source of extension risk for a planned amortization class of a CMO

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