Comments on: What is the FED new lending facility all about? http://lendingproguide.com/what-is-the-fed-new-lending-facility-all-about/ Free Consumer Lending Resource Tue, 22 May 2012 02:45:29 +0000 http://wordpress.org/?v=2.7 hourly 1 By: gray shadow http://lendingproguide.com/what-is-the-fed-new-lending-facility-all-about/comment-page-1/#comment-323 gray shadow Mon, 18 Aug 2008 11:19:47 +0000 http://lendingproguide.com/what-is-the-fed-new-lending-facility-all-about/286/#comment-323 Here's a great FAQ on the TAF: - Re: If a company puts up mortgage back securities as collateral for a loan from the Federal Reserve, what happens if the owners default? The Depository Institution must pledge additional collateral, or be subject to remedial action by the Federal Reserve (i.e. the Feds come in and treat it as insolvent) - Re: If companies already wrote off their bad loans, how can they claim it as collateral? Written off loans cannot be considered collateral. By 'writing them off', they are removed from the books as an asset. Here’s a great FAQ on the TAF:

- Re: If a company puts up mortgage back securities as collateral for a loan from the Federal Reserve, what happens if the owners default?

The Depository Institution must pledge additional collateral, or be subject to remedial action by the Federal Reserve (i.e. the Feds come in and treat it as insolvent)

- Re: If companies already wrote off their bad loans, how can they claim it as collateral?

Written off loans cannot be considered collateral. By ‘writing them off’, they are removed from the books as an asset.

]]>