Moody's downgrades US existing subprime pre-2005 pools because housing has not finished its freefall

Housing's woes are not finished.  At least that is Moody's take as they are still downgrading deals which were originated before 2005.  Moody's downgraded the ratings of 8 tranches from 3 Subprime deals issued by various financial institutions. The collateral on these loans is mostly consists of first-lien, fixed and adjustable rate Subprime residential mortgages.
They were downgraded them because loan performance is not improving as expected.  It is actually getting worse.  Although most of these pools have paid down or paid off, what is left is still getting hit.  And since some of these guys are underwater due to deteriorating homes, they cannot payoff. Via Moody's:
The above mentioned approach " Pre-2005 US RMBS Surveillance Methodology " is adjusted slightly when estimating losses on pools left with a small number of loans to account for the volatile nature of small pools. Even if a few loans in a small pool become delinquent, there could be a large increase in the overall pool delinquency level due to the concentration risk.
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