Moody's Investors Service on Friday took ratings action on $5.2 billion of Alt-A mortgage-backed securities issued by J.P. Morgan in 2006 and 2007.
The review included a downgrade on 72 tranches, an upgrade on four, and a confirmation of ratings of 17 tranches from 14 RMBS transactions. The bonds are backed by alt-A loans, issued by J.P. Morgan Alternative Loan Trust.
The collateral consists primarily of first-lien, fixed and adjustable-rate alt-A residential mortgages.
Moody's cited the "rapidly deteriorating performance of Alt-A pools in conjunction with macroeconomic conditions that remain under duress." Many alt-A loans were made to self employed consumers and/or borrowers who did not have to verify their income.
The actions reflect the agency's updated loss expectations on alt-A pools issued from 2005 to 2007.
On Thursday Moody's downgraded $2.8 billion of adjustable rate alt-A RMBS issued by Credit Suisse First Boston in 2006 and 2007.
