Subprime Mortgage Defaults Pass 2001 Peak

Published on:
6 February 2007 at 04:40 a.m. ET

Written by: Unknown Author –

http://www.insidearm.com/news/00007224-subprime-mortgage-defaults-pass-2001-peak/

Folks with poor credit histories and/or large debt burdens pulled it together and surpassed 2001’s peak of defaults this past November, according to Friedman Billings Ramsey Group Inc. and covered on Bloomberg.com.

The percentage of subprime mortgages packaged into bonds and delinquent by 90 days or more, in foreclosure or already turned into seized properties climbed to 10.09 percent from 9.08 percent in October, the report shares.

Bloomberg.com picked up the following inscrutable quote from Debashish Chatterjee, an analyst at Moody’s Investors Service in New York, on the phenomenon: “These borrowers are very leveraged and have little skin in the game.”

Falling housing prices and fraud by borrowers are fingered as the culprits.