What is a mortgage backed security and how does it impact me as a mortgage holder?

If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!

Yesterday was a huge news day on Wall Street as Standard & Poors announced they will be changing the way they rate the credit derivatives made up of subprime mortgage loans. This is expected to have dire consequences to the hedge funds, pension funds and other investors that are holding subprime-backed mortgage securities as the value gets hammered from the new rating system.

If all of this news has you confused here is a great clip from CNBC about how mortgage backed securities work and why this new rating system is a major sea-change for Wall Street and subprime mortgages (h/t Keith at HousingPANIC for the link)

Last 3 posts by Morgan

• Subprime Bananas - June 28th, 2009
• Roubini: No confidence in government exit strategy - June 24th, 2009
• Goldman bonuses largest in firm's 140-year history - June 21st, 2009

Share At:

Hide Sites

Related posts:

1. The explosion of a mortgage-backed security in stick figures
2. The Fate of Mortgage Backed Securities
3. S&P to Downgrade Coming to Alt-A Mortgage Backed Securities
4. Moody’s Downgrades $33 Billion in Subprime Mortgage Securities
5. What this week’s news means to you as a mortgage holder