Billions at stake in landmark MBS case

摘要

New York's highest court last week began hearing what could be a landmark case in the litigation of shoddy pre-crisis mortgage lending, with ground-shaking implications for the MBS market. On the surface, the case centres on a legal technicality -when exactly the state's six-year window begins for forcing originators to re-buy faulty loans underlying bonds. But the ultimate ruling by the New York Court of Appeals could in effect decide whether banks end up owing billions of dollars in damages over crisis-era MBS that went sour.