NEW YORK CITY-Loss severities on CMBS were already well above the historical average in the second quarter, Moody’s Investors Service said in August. On Thursday, the ratings agency said losses for the third quarter were even higher, with the average historical weighted loss severity rising to 38.4% from 35% in Q2.

An additional 498 CMBS loans were liquidated at a loss during Q3, at an average loss severity of 52.6%, compared to 42.8% for the 342 loans liquidated in the previous quarter. Moody’s says that the cumulative loss severity rate will continue to rise as more loans from the troubled 2006-2008 vintages are liquidated at relatively higher loss severities, while the near-term forecast calls for a greater percentage of CMBS loans that are in delinquent or in special servicing.

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