Alt-A defaults climb

Even as subprime foreclosures seem to be stabilizing, the problems are increasing in Alt-A mortgages, the next class above subprimes.

While many subprime loans were 2/28s or similar, i.e. interest-only the first two years, many alt-As, and even some primes, were 5/25s or 7/23s or similar. And now, the piper is calling the tune on the 25- or 23- year period.

And, here’s more on the uncharted territory of the mix of falling home prices, mixed with rising oil and food prices, that’s pushing more of these alt-A and even prime homes into trouble.