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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: GraceZ who wrote (51490)	4/6/2006 12:07:55 PM
From: deeno	Read Replies (1) \| Respond to of 306849

as you already know "like the little old lady with the Fannie Mae fund, is going to lose, not them" If FNMA stamps it. Shes ok. If your saying the "fund" might own non-FNMA CMO's you could be right but most times these "whole loans" are over collateralized. So the discount would be taken in the packaging. In other words a loss or two is no big deal to anyone, its expected (and yes therefore resulting in higher rates or fees that might otherwise prevail). Obviously if everyone decided to stop paying that would be a problem for everyone. BTW I'm not trying to justify the morality. Whether there is a loss, and how big, and who takes it, is irrelavent.