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Subprime mortgage ??
- Thread starter billfred
- Start date
calveless wonder
New member
well, lets see....
i lost half my book of my business. (probably about 15k worth of commisions in my pocket)
due to certain banks going out of business and rate/program changes.
the past 2 years i've done about 95% subprime business. all my clients have shit credit pretty much
it sucks, but...adapt or die.
i have a million clients that can't get loans now and are on the verge of foreclosure and don't have enough equity to do anything. they're fucked
i lost half my book of my business. (probably about 15k worth of commisions in my pocket)
due to certain banks going out of business and rate/program changes.
the past 2 years i've done about 95% subprime business. all my clients have shit credit pretty much
it sucks, but...adapt or die.
i have a million clients that can't get loans now and are on the verge of foreclosure and don't have enough equity to do anything. they're fucked
calveless wonder
New member
on a side note, it's cyclical.
it'll past within a couple of years but the market needs a major correction.
all the banks going out of business now are paving the way for new investors (hedge funds, etc other sources of private money) to get into the lending business.
All the banks that are going out of bsuiness now, made their money writing crappy notes (fraudulent, overstated income,etc.) They made a killing back in the day, but this is the result of shady guidelines and giving ridiculously risky loans to everyone and their mother.
things will tighten up, rates will go up for a bit...but people still need houses, people still need to refinance, it'll just take a while before it levels out
it'll past within a couple of years but the market needs a major correction.
all the banks going out of business now are paving the way for new investors (hedge funds, etc other sources of private money) to get into the lending business.
All the banks that are going out of bsuiness now, made their money writing crappy notes (fraudulent, overstated income,etc.) They made a killing back in the day, but this is the result of shady guidelines and giving ridiculously risky loans to everyone and their mother.
things will tighten up, rates will go up for a bit...but people still need houses, people still need to refinance, it'll just take a while before it levels out
calveless wonder
New member
billfred said:
are there banks going to go down? hahahaha.....
110 since february bro. 110 lenders
One of my biggest lenders (First magnus) is gone. I had a friend who had 7 loans with them and they're gone. It was probably half a years worth of his income...luckily he can save a few of them, but it's hectic.
lots of banks are going down. Countrywide is supposedly filing BK....
but like i said, when the giants fall, others will take their place
calveless wonder
New member
billfred said:
those are only considered the majors because of their checking/savings etc. They also write alot of A-paper stuff (people wiht good credit). That market will always be pretty stable, so most of the borrowers are so low risk.
countrywide is only of those in "major" trouble, but that's because they write alot of subprime and alternative "a" loans.
calveless wonder
New member
gotmilk said:
I thought the lack of liquidity right now was their main issue?
calveless wonder
New member
gjohnson5 said:
highest rate you will see on a residential loan is 12-13%. And that's hard equity..meaning they probably have no job, or are about to go into foreclosure or something similar.
give me a break that these lenders are predatory and the people are victims. granted, there have been so many shady brokers and salespeople in the last few years (especially during the boom, where any joe schmoe could come in and make money..and do terrible things to their clients) but at the end of the day the paperwork explains everything. fact is, a large part of america lives above their means and is completely irresponsible wtih their finances. there is a price to pay
interest rates are calculated on the risk of the borrower....and margins. I.e. what it can yield on the secondary market, and what offsets <x> amount of defaulted/foreclosure loan.
gjohnson5
New member
I mean home loans (well you say home loans don't apply), car loans , payday loans, creidt card companies and all
If a large part of america lives above thier means then why do people go out of thier way to create speculative loans at high interest knowing they have trouble paying thier bills...
You deserve what you get the same as they do...
If a large part of america lives above thier means then why do people go out of thier way to create speculative loans at high interest knowing they have trouble paying thier bills...
You deserve what you get the same as they do...
calveless wonder said:
gotmilk
New member
calveless wonder said:
They took out almost $12 B in their last line of credit. Have almost $22 Billion in deposits just from account holders with a minimum $1ook per account. Plus, offered a higer interest rate to anyone willing to open a new cd.
They still need to sell more notes to cover themselves just in case though....and no one is willing to buy those notes (except ole Warren since he's not using debt to puchase debt)
dead_reggin_storage_fashi
New member
we are not going BK
(C.F.C that is)
holding strong...
we use that 11.5 Billion dollar line to fund our own loans now.
sad too see peeps getting fired recently and I am one step away from being a SL/VP...
things that suck now for me
1. no one has equity in their home
2. guidelines are fucking tight
3. we have a bad name now so this sucks
4. interest rates are up
and within internal
5. new software upgrades are not working (so many bugs)
6. alll upper management only knows the good days so they never been knee deep in shit
(C.F.C that is)
holding strong...
we use that 11.5 Billion dollar line to fund our own loans now.
sad too see peeps getting fired recently and I am one step away from being a SL/VP...
things that suck now for me
1. no one has equity in their home
2. guidelines are fucking tight
3. we have a bad name now so this sucks
4. interest rates are up
and within internal
5. new software upgrades are not working (so many bugs)
6. alll upper management only knows the good days so they never been knee deep in shit
jnevin
New member
billfred said:
Actual banks won't be hit as hard, but it's affecting the nation's and the world's economy. The worst part is still coming. All of these subprime borrowers that have mortgages that will adjust in the next few years are screwed. Guidelines on conforming loans will probably tighten, and most lenders have done away with their alt-a products, which will leave these people with usually high debt ratios in loans that will jump 1.5-2% every six months. If a lot of lenders saw people go into default in the last few years, it's only going to get worse when the people in these loans can't refinance out of them. It's really a mess. I lost 2 jumbo loans today because of changing guidelines. Lenders are pulling their reduced doc (stated but able to show liquid assets) and probably soon pulling their stated/ stated programs. Tons of people aren't going to get loans, builders will suffer, laborers won't be working, and strippers will ultimately be the ones to suffer. I think half of the people shamelessly wasting money at strip clubs are 21-25 year old loan officers that just had a huge payday and think the money will come forever.
jnevin
New member
gotmilk said:
$12B hardly makes a dent in CW's operations costs. They aren't going to Bk, but they'll take a pretty good hit. They bought too much paper is what their problem was. They bought so much shit because of the money from servicing and didn't audit the files the way they should have. Buying from ameriquest and hfc nailed them. Plus, they were buying from Long Beach (WAMU) and the Moore Division (Wells' sub prime), and they had pretty lax underwriting practices. CW wrote a lot of subprime and they allowed a ton from brokers, which is where most loan fraud occurs.
H
heatherrae
Guest
They were predatory and sought to ruin lives. Now they are going down. Good riddance.
jnevin
New member
I didn't even read what our resident paralegal said, but I'm sure it was something about the banks trying to take the peoples' homes, that it was never a borrower's fault, and that the banks and their thousands of employees deserve to be broke and on the street. Definitely not the borrowers that signed all of the paperwork confirming the information. Nooooo. They're all victims.
H
heatherrae
Guest
People trying to buy homes to house themselves and their children --yeah, those are the real bad guys.
I did nothing but foreclosure work for over 2 years. Only ONCE did I see an application where the borrowers lied. I saw a few where the brokers forged different numbers on the applications after the borrowers signed for it. 99.99% of were the victims of predatory lenders. I hated my own clients for the most part.
And, if you want to look up my bar credentials, I will give you the link. I know that would upset you to see, though.
I did nothing but foreclosure work for over 2 years. Only ONCE did I see an application where the borrowers lied. I saw a few where the brokers forged different numbers on the applications after the borrowers signed for it. 99.99% of were the victims of predatory lenders. I hated my own clients for the most part.
And, if you want to look up my bar credentials, I will give you the link. I know that would upset you to see, though.
jnevin
New member
K, I read that one. So, you're telling me that the docs signed by the borrowers were changed from when they signed at the title company or attorney's office to when they were sent back to the bank's funding department? The only ones that could do that would be the ones that signed the borrowers. Title companies and attorneys have copies of every file they sign, so they'd be the ones that changed them, not the lender. The borrower signs and confirms every bit of information at a closing. It's what makes them responsible for the loan.
H
heatherrae
Guest
In the cases I'm referring to, the loan brokers altered certain pages and forged signatures on applications before they were submitted to the lenders. We aren't talking about docs signed at closing. I did probably close to 4500 foreclosures and only in 1 of those did the borrowers lie on the application.jnevin said:
H
heatherrae
Guest
They sign stacks of docs. You've been to closings, I'm sure.
One of the brokers to whom I'm referring shot himself in the head after we figured out how the docs got changed around. He did it fro the commissions. I'm sure he did it lots but he got caught once.
Most of those subprime lenders were scumbag companies. Sorry if you are one and that offends you but they are. I felt dirty representing those scumbags. My conscience felt way cleaner representing accused felons than those scumbag lenders. Don't get me started on the buy here pay here car lots either. I had one of those as a client too. I don't know how the owner put his head down on the pillow at night. I used to have to take him to derby and shit all the time. Bleh.
One of the brokers to whom I'm referring shot himself in the head after we figured out how the docs got changed around. He did it fro the commissions. I'm sure he did it lots but he got caught once.
Most of those subprime lenders were scumbag companies. Sorry if you are one and that offends you but they are. I felt dirty representing those scumbags. My conscience felt way cleaner representing accused felons than those scumbag lenders. Don't get me started on the buy here pay here car lots either. I had one of those as a client too. I don't know how the owner put his head down on the pillow at night. I used to have to take him to derby and shit all the time. Bleh.
jnevin
New member
There's a huge difference between a lender and a mortgage broker. The 1003, or loan application is the first that usually gets signed. The escrow officer hands it to the borrower and says "This is the loan application. This is the information you provided the lender with to qualify for the loan." Unless the loan officer was in on it, which isn't uncommon, it was all on the borrower. They can play the victim pretty well though.
H
heatherrae
Guest
I didn't say that the lender did it in that case. I said from the beginning it was an independant broker. My point is that I handled tons of foreclosures and the problems with the industry certainly are not due to everyone lying on their applications.jnevin said:
jnevin
New member
jnevin
New member
jh1 said:
True. I can't believe how many dumb shit 20-something guys I'd see out wearing club clothes in the middle of the day talking about the customers they were screwing for an extra point at closings because they needed the loans. Many of them driving bimmers, etc. Yeah. They'll be selling used cars soon applying the same shitty tactics, screwing people. I'm kind of glad it's happening, I just wish my two biggest referral sources didn't move to other states. That stings.
jnevin
New member
jh1 said:
Not only the way they were living, but the way they treated their business. They just thought they could treat people poorly because the phone was always going to ring, or there would always be leads to call. It's just pathetic and irresponsible. You can make so much doing this without a ton of work once you figure out how you're going to do it.
calveless wonder
New member
jnevin said:
dead_reggin_storage_fashi
New member
jnevin said:
lol
hides
dead_reggin_storage_fashi
New member
i love heather! 
know - it - all
know - it - all
dead_reggin_storage_fashi
New member
I write alot of non-conf loans (hence cali, az, NV) and getting a non conforming priced out recently you are going to gag on the rates/guidelines
reduced doc non conforming
today
750 fico
60 LTV
10/1 non conf IO 5-2-5
par rate 8.625%
with 5 yr soft ppp and 2 points 6.75%
I seem to write all non conf (esp alot of Fixed rate seconds too)
ugh
reduced doc non conforming
today
750 fico
60 LTV
10/1 non conf IO 5-2-5
par rate 8.625%
with 5 yr soft ppp and 2 points 6.75%
I seem to write all non conf (esp alot of Fixed rate seconds too)
ugh
gjohnson5
New member
well I dunno.
The tech wreck of 2000 was more an over valuation of companies , many of which who were running w venture capital and not posting revenues.
Atleast in that case, the creativity and enginuity of people were driving the supply side to create jobs
This is just BS
The tech wreck of 2000 was more an over valuation of companies , many of which who were running w venture capital and not posting revenues.
Atleast in that case, the creativity and enginuity of people were driving the supply side to create jobs
This is just BS
jh1 said:
billfred
New member
gjohnson5 said:
In addition the tech wreck was really just a paper loss for many involved. Easy come easy go - paper was worth $1 when I got it, went to $200 - shit I didn't sell, now it is worth a $1 again.
This will hit deeper as it invovles impact two very key elements in our economy 1) Housing, 2) financial institutions/credit.
Not to mention the social issues of all the people getting put out on the street.
I think if there is any silver lining it could be that it is a good time to pick up a few rent houses.
patsfan1379
New member
Jnev wins again.
heatherrae said:
LOL! Scumbags? No, you didn't say "lenders" at all, did you? If you had said "brokers" I might agree. Brokers are 99% of the time the ones committing the fraud. Borrowers are not savvy enough to do it (unless they've worked in the industry), and lenders are the ones responsible for the notes (even when a lender sells a note they can be responsible for buying back a First Pay Default or Early Pay Default - for up to a year after it is sold).
So because a lender decides to take a riskier position in lending to an individual considered a higher credit risk, that company is the scumbag? CountryWide lends to Prime (A), Alt-A, and Non-Prime borrowers, as do many other companies. Is CWide a scumbag company? I could name dozens of other big, reputable, warm fuzzy companies.
Subprime accounts for maybe 15% of all borrowers in the market. Many of those borrowers do pay their mortgages, and are good risks, they just might not fall into the box that A paper lenders need them to fit into. Maybe they had a BK 2 yrs. ago, but have re-established credit and make good money, etc.
Maybe you meant to say brokers but mistakenly said lenders. And, for as many brokers out there who committ fraud, there's many good ones who don't. Kinda like lawyers, huh? Those scumbag pieces of shit.
All in all, this will affect many people in this sector (of course) and many people in the Alt-A and A paper lending sectors (this is already happening - CWide is getting a $2billion bailout from BofA). WAMU, CWide, World Savings, and National City all have huge amounts of non performing loans eating at their capital.
On a national economic perspective though, this won't even be as big as the S&L crisis was. It amounts to such a small percentage of the GDP, it will be barely a blip in history.
On a national economic perspective though, this won't even be as big as the S&L crisis was. It amounts to such a small percentage of the GDP, it will be barely a blip in history.
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