Sunday, October 21, 2007

Mortgage Security Bondholders Facing a Cutoff of Interest Payments

For all the pain in the mortgage market, investors who hold bonds backed by risky home loans have continued to receive their monthly interest payments until now.
Collateralized debt obligations made up of bonds backed by thousands of subprime home loans are starting to shut off cash payments to investors in lower-rated bonds as credit-rating agencies downgrade the securities they own, according to analysts and industry executives.

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