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Special Reports
In this section of BrokerUniverse we examine a subject of key importance
for mortgage originators every month, based on special reports that run in our sister publication, Origination News.
Nonprime Lending
Providing a Helping Hand
The subprime lending business gives consumers with less than perfect credit a
chance to buy or refinance.
But this business might be the one who needs a helping hand as it is once again at a crossroads and the survival
of a number of players is at stake.
Back in 1998, the secondary market for many nonconforming products shut down, forcing a number of companies, some
of which were the leading lights of subprime, out of business.
Once again there is a crisis in the secondary market, but this time the crisis is forced repurchases of mortgage
loans.
Over the past year, the number of repurchase requests from investors to originators has been on the upswing as
the decline in house value has taken hold.
Meanwhile, a growing number of companies have decided that the subprime business is not for them. Among the lenders
that have been placed for sale is Option One by H&R Block, First Franklin by National City and Champion by
KeyCorp.
In this Special Report read how a number of subprime mortgage lenders are reporting losses or reduced earnings
for the third quarter.
The nonprime segment is where many of the borrowers who make up the emerging markets first turn to for mortgages.
There are three stories that address this need, including one about a study conducted by Fair Isaac, which said
its Expansion score product is giving minorities improved access to credit.
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