Looking at the latest postings on the Broker Outpost, one would think the Sub prime market is ready to blow up:
(1) http://forum.brokeroutpost.com/loans/forum/2/77339.htm
Just got this in an e-mail. Anyone else heard of these?
Own It - CLOSED
Sebring - CLOSED
Maribella - CLOSED
MLN - Lost it’s only investor today, scrambling to replace them.
D1 - needs a 580+ for any stated Loans
People’s Choice - 660+ needed for FTHB to
On MLN:
Last night, their national director of Wholesale (PaulImpaggilazzo) resigned his position with MLN last night.He left his managers with a message that is being relayedto his AE’s today.
1. For the foreseeable future, we are only going to payyou 25% of all the commissions you earn and defer the restback into the company operating fund as we try to raisecapital to stay afloat - Unfortunately, at this moment, wecannot afford to pay you the full commission you earn.
2. Our exclusive sale agreement with RFC has beenterminated - we have nobody to sell our loans too.
3. We are heading to Wall Street immediately and beganyone we can to offer us warehouse lines of credit so wecan continue funding loans.
(2) Encore is out of business? http://forum.brokeroutpost.com/loans/forum/2/77503.htm
“And another one bites the dust (allegedly). At this rate there’s not going to be too many subprime lenders left”
Thursday, December 07, 2006
Sub Prime Blowup?
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8 comments:
Credit spreads are shrinking, causing a major liquidity problem - especially for these little subprime players.
http://wallstreetexaminer.com/blogs/winter/?p=157
THey aren't sub-prime lenders, they are sub-prime brokers. There's a difference and it is the same difference that caused all this trouble at the retail end; OPM (Other People's Money). The sub=prime brokers were lending other people's money and taking a cut. The home buyer never was their customer, the lenders were their customer.
And none of them did anything wrong, they just got caught up in the wave that swept bad mortbrokers away with the good.
Did nothing wrong - So placing families in 50%-70% monthly DTI was ethicically ok? I know it was not illegal, but...
BTW the lastest nnumbers from Gary Crabtree show the average DTI in Bakersfield at 48%. To me that is down right criminal if these people are put into loans that take that percentage of their monthly nut. Add in Income Taxes (Fed, State) and utilities (105 degree summer) - Is there any money to live on?
All lenders lend other people's money. Banks lend depository money, Hard money lends investor money, sub-prime lends from the hedge funds, the chinese, and other place they can find it.
All lenders lend other people's money. Banks lend depository money, Hard money lends investor money, sub-prime lends from the hedge funds, the chinese, and other place they can find it.
Bakersfield bubble,
Of course theres money left, just enough to head to the local Food Max and stock up on that nourishing
ramon noodle...it comes in BEEF flavor too..yumm
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