By Kevin O’Brien (March 8, 2018, 4:45 PM EST) -- When the housing bubble burst during the 2007-08 economic meltdown, the ripple effect on residential mortgage-backed securities was profound. Hundreds of billions of dollars of residential mortgages had been bundled into securities and sold to investors at a premium on the assumption that "housing prices will always go up." When the opposite occurred, and millions of Americans defaulted on their mortgages, the security holders were left with significantly impaired collateral. Myriad litigation ensued involving the banks that had extended the credit (in many cases, to borrowers who were not reasonable credit risks), financiers who had sold the loans, and insurers that had guaranteed repayment. ...