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US subprime mortgage bonds back in fashion

By Strategist following x   2018 Apr 1, 3:02pm 823 views   3 comments   watch   sfw   quote     share    


https://www.cnbc.com/2018/03/29/us-subprime-mortgage-bonds-back-in-fashion.html

Issuance of securities backed by riskier US mortgages roughly doubled in the first quarter from a year earlier, as investors lapped up assets blamed for bringing the global financial system to the brink of collapse a decade ago.

Home loans to people with scratches and dents in their credit histories dwindled to almost nothing in the aftermath of the crisis, as litigation-weary lenders retreated to patch up their balance sheets. But over the past couple of years a group of specialist firms has begun to bring the loans back, navigating a dense web of new rules drawn up to protect borrowers and investors in the $9.3tn US home-loan market.

Last year saw issuance of $4.1bn of securities backed by loans that would have been called "subprime" before the last financial crisis, according to figures from Inside Mortgage Finance, with the pace picking up in the latter half of the year. The momentum has continued into 2018, with deals worth $1.3bn in the first quarter — twice the $666m issued in the same period a year earlier.
1   Strategist   ignore (1)   2018 Apr 1, 3:08pm   ↑ like (0)   ↓ dislike (0)   quote        

I'm glad they are back.
Sub Prime loans and stated Income loans were NOT the cause of the 2008 housing crash. Those loans to people with no equity was the problem. I bet these loans making a comeback require a lot of equity.
Anyone who wants to buy their own home, and can make the payments deserve to get a loan, even if it's a subprime loan.
2   MrMagic   ignore (11)   2018 Apr 1, 4:06pm   ↑ like (0)   ↓ dislike (0)   quote        

Strategist says
I bet these loans making a comeback require a lot of equity.


I would bet just the opposite. Sub prime loans are probably the 3.5% down FHA Loans without any equity. These buyers are sub prime for a reason.
3   Strategist   ignore (1)   2018 Apr 1, 5:21pm   ↑ like (0)   ↓ dislike (0)   quote        

Sniper says
Strategist says
I bet these loans making a comeback require a lot of equity.


I would bet just the opposite. Sub prime loans are probably the 3.5% down FHA Loans without any equity. These buyers are sub prime for a reason.


As long as my tax dollars don't go to bailing out FHA defaults, I'm OK.




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