Standard and Poor’s said it has put 207 classes of securities backed by Alt-A mortgages on CreditWatch negative. The original total balance of the securities was $913.9 million. After the collapse of subprime lending, Alt-A loans are the next problem group which is causing significant losses to lenders and investors in mortgage-backed securities.
The situation on the mortgage market right now was aptly described as ‘panic’ in one publication, as virtually all types of non-conforming loans – from subprime to jumbo, are either no longer available or prohibitively expensive. Borrowers looking to refinance meet limited to no supply from lenders. Mortgage companies are making daily, and sometimes hourly decisions about the availability and pricing of products, making financing hard to come by.
In other news, the Fed Fund rate remains the same at 5.25%, as expected.
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