Fitch RMBS Report - This is seriously depressing

[Account Closed]

Check out this report on residential mortgage backed securities (RMBS) that came out on Oct 5.

A few things that it says is that delinquencies continue to increase at all time highs. Liquidation timelies continue to increase and banks are finding it more and more difficult to liquidate property. In particular, the report note that 12% of all prime borrows are now seriously delinquent. It notes that the borrowers in the RMBS pools that are "stronger" are able to refinance, and in particular, stronger prime borrowers are refinancing and thus depleting these particular securities of paying customers.

Fitch also "projects a 10% national decline in home prices and for unemployment to decrease to 8.2% over the next two years."

So a few takaways: Fitch thinks housing prices will continue to go down 10%, and the report shows that delinquencies for prime borrowers are increasing in delinquency. There could be more foreclosures up ahead, especially in nicer neighborhoods where a lot of these prime borrowers resided. I think we should consider that there is still a lot of inventory to come. Banks are going to have lots more property that will be coming through their shelves and they are finding it taking more time to liquidate. Time to start an REO property management company.

It is available here.