Here Comes the Credit Crunch

I guess New Century got a little tired of buying back mortgages put back to it by some clever hedge funds.


"IRVINE, Calif., Oct. 12 /PRNewswire-FirstCall/ -- New Century Financial Corporation (NYSE: NEW - News), a real estate investment trust (REIT) and one of the nation's premier mortgage finance companies, today announced the first of a series of additional lending best practices that its operating subsidiaries, New Century Mortgage Corporation and Home123 Corporation, will adopt in order to continue to provide customers with fair and informed access to credit."

Snip...

The changes that the company plans to adopt consist of enhancements to disclosures, controls, product design and underwriting. These changes include:

Tightening underwriting guidelines for its adjustable-rate mortgage
programs for at-risk borrowers.  This includes using the fully-indexed
rate minus 1 percent as the qualifying rate for these borrowers.

Full Crunch Measures...