Monday, August 21, 2006

A Credit Crunch is Coming

Wall Street is loosing its appetite for sub-prime, no doc loans and other exotic types of mortgages. When the mortgage companies loose the ability to sell the riskier mortgages to investors, they will stop offering these types of loans to certain home buyers. It looks like sub-prime lenders are scaling back these knds of loans already.


["NEW YORK (AP) -- Some mortgage lenders are feeling the heat from Wall Street to tighten their lending standards and cut their exposure to riskier loans.

The force at work is the increasing demand from investment banks for lenders to buy back the loans due to borrowers' failure to make their first few payments on those loans. Such "early payment defaults" so far have largely been limited to nonprime mortgages made to borrowers who pay higher rates than those qualifying for standard loans due to their weak credit or inadequate documentation."]

Full article...


3 Comments:

Anonymous Anonymous said...

HUD

You will notice that when reviewing sub-prime lenders, their stock prices and dividend return always reflect their riskiness.

Mr. Rant

Tuesday, August 22, 2006 8:39:00 AM  
Anonymous erin said...

Interesting read, thanks for the link.

Tuesday, August 22, 2006 2:46:00 PM  
Blogger Bill Harrison said...

Hi there Blogger, a real useful blog.Keep with the good work.
If you have a moment, please visit my College Loans site.
I send you warm regards and wishes of continued success.

Tuesday, September 12, 2006 6:46:00 PM  

Post a Comment

<< Home