Moody's Investors Service once again downgraded billions of dollars of residential mortgage-backed securities due to the continued deterioration in the performance of the underlying loan pools backing the transactions. The ratings agency lowered ratings on 195 tranches of Alt-A RMBS issued by Bank of America's (BAC) Banc of America Funding Trust. Analysts also confirmed the ratings of 13 tranches and upgraded the ratings of six tranches of Bank of America securities issued across 12 separate deals. The RMBS have a cumulative valued of $6 billion. In February, Moody's adjusted its loss expectations criteria for Alt-A pools issued between 2005 and 2007. Analysts continue to see the "increasing potential for a double-dip recession, which could cause a further 20% decline in home prices." Although, Moody's expects just a 5% decline in home prices with stabilization early next year and "continued stress in national employment levels." Earlier Friday, Standard & Poor's said the default rates for mortgages written in 2006 and 2007 are significantly higher than previous vintages. The ratings agency said default rates for all U.S. mortgages improved in the third quarter and were better than the first half , "though a full recovery within the housing market remains largely elusive." And on Thursday, Fitch Ratings said the robo-signing scandal is hurting servicing of RMBS, and analysts lowered the outlook for the entire $1.78 trillion sector to negative from stable. Write to Jason Philyaw. The author holds no relevant investment.