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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: rllee who wrote (31338)	7/3/2008 2:57:25 AM
From: Madharry	Respond to of 78751

When I spent a few minutes looking at his data, the only thing i could infer from the data is that delinquency rate of 31-60 days continues to be over 5%. anecdotally, i somehow missed a bill for my HELOC and my bank called me 4 days after the payment was due to ask if there was a problem. I had never in my life been called 4 days after a due date about anything. The point being that I am sure that banks are much more dilligent now about following up early on past due mortgages so that the 31-60 day delinquencies are real problems. To me this could represent about 20% of such loans going into foreclosure annually. I think the best argument for owning MBI might be the legal defense that loan originator in making many of these loans perpetrated fraud and therefore the MBI guaranty is not enforcable. However, there is also something called being a holder in due course which might apply to this. for example if A sells B a good fraudulently and takes back a note, and A then sells that note to C, B is still obligated to pay C on the note despite the fraud because C is considered a holder in due course- an innocent bystander in this fraud. I wonder if anyone who reads this has researched the legal aspects of the MBI and ABK gtys in any detail.