Regulatory scrutiny is the No. 1 challenge when it comes to retail marketing in the subprime market, according to Shayne Cardwell, vice president of strategic solutions at DWC Solutions, Boca Raton, Fla.In California, where there is a huge subprime market, it can take more than two months to get a direct letter reviewed by regulators before it can be mailed to consumers, he said. "The time it takes to get out is getting longer and longer," Mr. Cardwell told the 2nd Annual Subprime Symposium in Las Vegas, sponsored by National Mortgage News and Origination News. "It's the guys in the middle, not the top or the bottom, who need to find their niche. Know your target audience." Forrest Young, vice president of marketing at Houston-based Aegis Lending, said lenders must mitigate the risk associated with the national do-not-call regulations. In five years, the do-not-call list is expected to include five million members, he said. "Build and maintain an in-house database," Mr. Young told the symposium. "Scrub your external and internal lists weekly and every 90 days. Evaluate your loan officers, and make sure they are licensed to do business in certain states."

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