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Politics : Sioux Nation -- Ignore unavailable to you. Want to Upgrade?

To: cirrus who wrote (160496)	2/12/2009 2:45:26 PM
From: Travis_Bickle	1 Recommendation Read Replies (1) \| Respond to of 362578

The answer to a lot of the questions is "nobody knows." Tanta, who sadly passed away a couple of months ago, from CR's blog was the most knowledgeable person and she said it was a mess calculatedriskblog.com You could learn a lot reading everything she posted but it would take a while. Prepays are pretty easy ... the people who own the stream of interest payments (interest only strips) get hosed, their investment is now worth zero because there are no further payments coming ... the people who own the principal benefit cause they get paid early. Prepays have killed many lenders over the passed couple of decades. Re modifications, Tanta did some long posts on that. First, nobody is really sure who owns these instruments cause most are held in street name, and the owners are worldwide. Each pool of mortgages has a "servicer," which might be Countrywide. The servicer has limited ability to modify the terms of the mortgages, which is spelled out in the indenture through which you buy the securities. The issuer is totally out of the picture unless it also happens to be the servicer. The servicer forecloses if the loan is delinquent, all that is spelled out in the indenture.

To: cirrus who wrote (160496)	2/12/2009 3:46:38 PM
From: stockman_scott	Respond to of 362578

15:13 Follow Up: US eyes home loan subsidies in rescue plan, according to sources - Reuters Reuters reports that the Obama administration is hammering out a program to subsidize mortgage payments for troubled homeowners who have gone through a standardized re-appraisal and affordability test, sources familiar with the plan said on Thursday. The program would be a major break from existing aid programs, which are triggered once homeowners fall into arrears. Under the plan being contemplated, mortgage companies would use a uniform eligibility test even before a borrower becomes delinquent, sources said. The administration hopes the mortgage industry will soon agree to a set of standards that will allow it to move quickly to modify many home loans. Sources said government-controlled housing finance companies Fannie Mae and Freddie Mac would play a supporting role in the government's new plan, but said they are not expected to expand their securitization of loans. In an interview, James Lockhart, the regulator that oversees Fannie Mae and Freddie Mac , said the mortgage finance industry was eager to have a standardized mortgage modification standard. "I've talked to all the major servicers -- both the big bank ones and the big independent ones -- and they are all ready to go, they're chomping at the bit," Lockhart, the director of the Federal Housing Finance Agency, said. "The other thing they're asking for standardization."