wonder why the originating banks didn't see this one incoming...
The three largest banks bought the three largest mortgage originators...
{Chase with WAMU, BKoAmer with Countrywide and Wells with Wichovia}
not only did the Fed Govt, under W, bailout the banks...
but, he "nationalized" both FMae and FMac.
and then the US Treasury bought US$ 1.2 Trillion of F&F's bad loans...
so they could make more RE loans to U.S.
So..., when WE ordered them FMae&FMac to go back and LOOK at those originations...
what do WE now see...
Lenders are getting repurchase requests on the same loan at multiple times for multiple issues
What that is telling U.S. is that those loans were not just a little bit bad, but multiple times bad.
And, the Bad Guys who sold them to U.S. are now going to have to take them back and cover their losses.
Ah..., don't you feel sorry for them...
{that is really not a question}
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In the second article Bloomberg covers MGIC - the mortgage insurer for low down payment ARMS.
Note, that after the collapse of securitization, those bad ARM might have been covered by MGIC
and if they were, they probably were also covered by credit default swaps.
Since July 08 almost ALL of the low down payment RE loans have been made by FHA...
which last month made MORE loans to U.S. than both FMae &Fmac combined...!!!
All low down payment RE loans since July 08 have been "insured" FHA loans.
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Mortgage Lenders Seek Relief on Bad Debt Repurchases
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MGIC Leads Decline in Mortgage-Insurer Credit Risk
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