Default rates on subprime mortgages will reach 22.17% by October, a 12-month increase of 14%, according to a new forecast made by Friedman Billings Ramsey. FBR sees alternative-A defaults rising to 6.67% in October, compared with 5.36% a year earlier. FBR says the higher default rate projections were spurred by a deteriorating labor market. On Friday, FBR threw its subprime unit, First NLC Financial Services, into bankruptcy. (See item above.) The lender is expected to be liquidated.
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The new Financial Stability Oversight Council report also recommends an expanded Ginnie Mae PTAP facility and an industry-funded liquidity resource.
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The publicly traded title holding companies all had stronger earnings as the mortgage market improved from one year prior.
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One in every 37 residential properties nationwide had a loan-to-value ratio of 125% or greater to begin the year, according to a new report.
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There's temporary leeway on formal compliance with replacement-cost value requirements in order to sort out insurer concerns with a recent re-emphasis on them.
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Max Levchin, CEO of the buy now/pay later lender, said recent tests show young adults prefer interacting with intelligent chatbots over phone-based agents, but the company doesn't foresee major cost savings from generative AI for a few more years.
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Test your knowledge of the biggest mortgage headlines of the week. No. 2 pencil not required!
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