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Moody's Refines Analysis of Subprime Hybrid Loans.

Mortgage Servicing News

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New York -- Moody's Investors Service is refining its loss coverage methodology for subprime hybrid adjustable-rate mortgages

The rating agency said it would apply this revised methodology to subprime securitization deals closing on or after April 15.

The changes are designed "to better account for the observed range in product features utilized in the marketplace, including differences in the interest rate caps and the degree of start rate discount embedded in the loan rate structure," Moody's said.

The rating agency is changing its methodology because its analysis of mortgage pools shows "that variations in these features, particularly under a rising interest rate environment, result in a ...

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Source: HighBeam Research, Moody's Refines Analysis of Subprime Hybrid Loans.

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