Contrary to expectations, a weak economy and rising unemployment have not weakened the performance of subprime mortgage loans, according to Moody's Investors Service."Through analysis of Moody's Home Equity Index, we see that the increase in unemployment has so far had minimal impact on subprime performance as delinquency rates and losses have held steady," said Julia Tung, a Moody's analyst. However, Moody's warned that future subprime performance could suffer if increased lender competition leads to a relaxation of underwriting standards. Moody's can be found online at http://www.moodys.com.
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