How Toxic are the Worst of the Mortgages? – by: Chris Palmeri – … Here are some more of his results: Of the 3.7 million home loans made in 2004, less than 1 percent have since resulted in a lender filing a default notice. Of the 3.7 million loans originated in 2005, 4.9 percent have triggered a default notice so far. Of the 3 million in 2006, 8.5 percent have so far resulted in default. The most toxic period was August through November 2006 which had more than a 9 percent default rate. Of the 2.1 million loans made in 2007, it’s 4.6 percent. … -  BusinessWeek

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The true causes of the housing crisis – By REP. JEB HENSARLING – For example, the CRA compelled banks to relax their traditional underwriting practices in favor of more “flexible” criteria. … Where Miller and I do agree is that the CRA did not cause this crisis by itself. Instead, blame should be accurately directed at Fannie and Freddie and their thirst for weaker underwriting to help meet their federally mandated “affordable housing” goals.  …  These subjective standards were … – Politico
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FBR: Bank Of America Needs $70 Billion – by Tyler Durden – Paul Miller has released a report that none of the programs trading the market currently have obviously read. Regardless, in keeping with hopes that at some point cheerleading and rationality prevail, it is prudent to at least know what will happen as you are purchasing BAC stock Wednesday. Miller’s conclusion is for a cool $60-$70 billion capital deficiency at BofA if the bank wishes to maintain the 3% TCE ratio it needs to be “viable” and recommends that the company convert $27 billion of private preferreds into common, in line with what Citigroup has done – Zero Hedge

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Treasury Announces Receipt of Applications to Become Fund Managers – under Public Private Investment Program – The Treasury Department today announced the receipt of more than 100 unique applications from potential fund managers interested in participating in the Legacy Securities portion of the Public Private Investment Program (PPIP).  A variety of institutions applied, including traditional fixed income, real estate, and alternative asset managers. – thanks Marty Rosenblatt – US Treasury Press Release