by Calculated Risk on 4/29/2008 07:50:00 PM

From Reuters: S&P cuts $41 bln of mostly higher-rated Alt-A deals

Standard & Poor's cut the ratings on about $41 billion of mostly higher-rated U.S. residential mortgage-backed securities backed by so-called Alt-A loans on Tuesday.

The rating agency's action affected 2,183 RMBS classes from 334 Alt-A deals originated during 2006.

And here is a key statement on foreclosures and REOs:

"Due to current market conditions, we are assuming that it will take approximately 15 months to liquidate loans in foreclosure and approximately eight months to liquidate loans categorized as real estate owned (REO)."

So homes going into foreclosure today - in S&P's view and on average - will be liquidated 15 months from now, or in the summer of '09. So much for the '09 spring selling season - it will be dominated by REOs from the record foreclosure activity today.