Mortgage Securities Investors Oppose 'Interest-only' Modification Proposals

Coalition Presses for Sustainable Solution for Homeowners

WASHINGTON, Oct. 15 /PRNewswire-USNewswire/ -- It was reported this week that
members of the financial services industry are considering lobbying the
Treasury Department to include more aggressive interest-only periods for
mortgages modified under President Obama's mortgage modification program
(HAMP).

Over the past three years, mortgage modification guidelines primarily have
been established by banks and loan servicers. Policy makers, homeowners and
investors have grown frustrated with the lack of successful modifications that
have been completed.

Mortgage securities investors are now organizing efforts to create new ideas
and complementary solutions that would address the mounting foreclosure
problem.

"The Mortgage Investors Coalition is focusing on solutions to re-equitize
homeowners," said Micah Green, a partner at Patton Boggs who represents the
coalition. The coalition was formed in March 2009 by asset managers who
currently hold over $100 billion in residential mortgage-backed securities, on
behalf of pension funds, college endowments and other investors.

The Mortgage Investors Coalition (MIC) calls today on the Treasury Department
to reject the banks' recent proposal on interest-only modifications.

"Modifying homeowners into mortgages that have future payment increases and
adjustable interest rates will not improve a homeowner's situation," Mr. Green
said. "Doing so would ignore the fact that many of these homeowners are
already in interest-only or other non-traditional mortgages and owe more on
their mortgage than their home is currently worth," he said.

The coalition joins a growing number of noted scholars and economists who
believe that restoring equity through a refinance is the only true way to
assist homeowners suffering hardships.

"The Mortgage Investors Coalition believes any changes to HAMP should focus
on refinancing homeowners into long term affordable fixed rate mortgages, so
homeowners and the housing market don't have the threat of interest rate
resets, balloon payments or large payment shocks in the future that could
drive additional foreclosures," Mr. Green said.

The MIC commends policy makers for their ongoing work to find new solutions to
stem the tide of foreclosures and look forward to continuing to play a
positive and constructive role in solving this critical problem for the
nation.

SOURCE Mortgage Investors Coalition

Rebecca Carr of Patton Boggs, LLP, +1-202-744-9911