Is June 20th the end of forbearance for ACA? A month ago, I mentioned this company and its importance to the credit crisis. I also mentioned how this situation is being ignored by most of the media and investors. It still is being ignored. Oh well - forbearance agreements have a habit of allowing us to avoid dealing with real issues.

The last forbearance agreement ended 5/30/2008 and was extended until June 20th. Why June 20th? Please read this article from SmartMoney and you’ll notice this line…..

Its current forbearance agreement extension expires on May 30, and it has a June 20 deadline to “permanently solve the company’s capital and liquidity issues,” ACA said in its May filing.

“Permanently solve the company’s capital and liquidity issues” - think about that. It sounds like the end of the road. It sounds definitive and tough. So far I haven’t seen too many deadlines that don’t get extended if the consequences are great. If the permanent solution doesn’t appear in the next two weeks, it will be interesting to see how this is resolved. If ACA isn’t a big deal (like I think it is), the forbearance can end without it upsetting the credit markets. Otherwise, it will likely lead to more writedowns.