Freddie Mac (FMCC)

[mrfence]

A cram down is what Bove is predicting for preferred which is why preferred debt holders won't get par in ANY settlement.

What Is a Cramdown?
A cramdown is the imposition of a bankruptcy reorganization plan by a court despite any objections by certain classes of creditors. A cramdown is often utilized as a part of the Chapter 13 bankruptcy filing and involves the debtor changing the terms of a contract with a creditor with the help of the court. This provision reduces the amount owed to the creditor to reflect the fair market value of the collateral that was used to secure the original debt.

KEY TAKEAWAYS
Cramdowns are reductions in the amount owed to creditors, often part of a Chapter 13 bankruptcy filing.
Cramdown provisions allow bankruptcy courts to ignore objections by creditors to recognize debts.
Cramdowns are often used with secured debts, such as auto and furniture, but not permitted for mortgages on primary residences.
The term "cramdown" comes from the idea that the loan changes are "crammed down" creditors' throats.
Secured creditors will often do better in a Chapter 13 reorganization than unsecured creditors.

https://www.investopedia.com/terms/c/cramdown.asp