Alt-A is really out there but the consensus is about $600B. The most important and damaging part of that seems to be the Pay Option ARM products in the Alt-A space. With estimated $500B in Pay Option out there that would be about 80% of Alt-A.
I think many people consider alt-A and option ARM interchangeable. They are not. These are not mutually inclusive categories (nor mutually exclusive).
Option ARMs are toxic. But they are a category of loan product that was available as alt-A, prime and even sub-prime.
Alt-A includes not only option ARMS, but fully amortizing and IO options on 5/1, 7/1, 10/1 ARMS, and 15, and 30 year fixed.
So the $500 Billion pay option ARMS are toast, but they are not all Alt-A loans. Some were/are subprime and prime.
Option ARM are toast. Alt-a as a general category is another question.
