Wall Street Journal (02/01/08) P. C2; Ng, Serena; Reilly, David
With the housing market continuing to show no signs of even a slight rebound, Moody's Investors Service has boosted its projections for losses among subprime mortgage loans. The credit rater now expects total losses on subprime mortgages taken out in 2006 to settle between 14 percent and 18 percent compared to the firm's previous projection last fall of average losses in the range of 6.6 percent to 15 percent. The revision was prompted by two factors: the deteriorating outlook for residential values and the increasing number of subprime borrowers who have stopped making mortgage payments. Moody's pessimism, coupled with a tidal wave of mortgage-debt downgrades from Standard & Poor's on Jan. 31, has had a ripple effect on the nation's credit markets, driving prices of some agency mortgage securities lower.
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