by Calculated Risk on 9/18/2008 03:59:00 PM
Thursday, September 18, 2008
Moody's Increases Loss Forecasts on Some Mortgages
From Bloomberg: Moody's Raises Loss Forecast on Subprime, Jumbo Loans (no link yet). Moody's increased their loss forecasts for certain securitized subprime and Jumbo-prime mortgages, and cautioned about related downgrades of securities and financial firms.
Losses will reach an average of 22 percent on subprime loans underlying bonds created in 2006 ... That's up from an estimate of 14 percent to 18 percent made in January.Notice the sharp increase in losses for prime jumbo loans in 2006 bonds.
Losses on jumbo loans in 2006 bonds will rise to 1.6 percent to 2.1 percent, versus initial estimates of 0.35 percent and 0.60 percent.