Coming Alt-A Crisis?

Orange County Register

Alt-A delinquencies hit 2.90 percent in February, more than double 1.23 percent a year ago, according to First American LoanPerformance, which tracks loans sold to investors as securities. Yet while that's much greater than 0.47 percent for prime loans, it's far from the 14.79 percent for subprime.

Analysts say delinquencies are rising in the Alt-A sector for the same reasons as subprime: too many loans made with little or no down payments combined with little or no proof of income. That's a combination sure to backfire as soon as home prices dip, experts say.

It's hard to see how the mortgage debt problem would just stop at the sub-prime market.Especially if we get a recession in the next 24 months.