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Inside Nonconforming Markets

May 12, 2006

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Ameriquest Layoffs, Closings, May Help Open New Doors for Rivals

Massive layoffs and branch closings at Ameriquest Capital Corp. promise to reshape the subprime market landscape in the months ahead. In fact, some lenders are already lining up to exploit what they see as a golden opportunity to gain market share from a strategic retrenchment that could put as much as $3 billion a month in new retail business into play. … Read More

Subprime Loan Volume Falls Sharply in Early Part of 2006

Slowing home prices and rising interest rates appear to have finally caught up with the subprime market as volume dropped sharply early in the year, a new Inside B&C Lending analysis suggests. Inside B&C Lending estimates that $155 billion in new subprime loans were originated during the first three months of 2006. While that marked a solid 11.5 percent rise from the same period in 2005, volume was down by a steep 13.8 percent… [Two data tables included] Read More

Amid Financial Problems, REIT Aames Negotiates Sale

A longtime subprime player has put itself on the sales block. In its earnings report issued last week, Aames Investment Corp. revealed that it is seeking strategic alternatives – including a possible merger. Officials were mum on many of the details, though in a conference call they told analysts that there is a “very significant” possibility that something could be announced prior to the end of the current quarter. … Read More

Softer Second-Lien Market Leads to New Strategies

Second mortgage lending has become a key component of the strategy of many subprime lenders, who are pitching piggyback combos as a way for borrowers to keep their payments low while eliminating the need for potentially costly mortgage insurance. There is no question that second mortgages are popular. According to the Inside Mortgage Finance MBS Database, second mortgages accounted for 15.7 percent of the subprime loans securitized during the first three months of this year.… Read More

Premier Touts Best Practices In Mortgage Banking Push

A Seattle-based mortgage broker, Premier Lending, is expanding its reach – adding mortgage banking capabilities through partnerships with some of the subprime market’s largest players. The launch of Premier’s mortgage banking operation highlights a trend that lenders have tried to nurture: the transition of brokers into correspondents that can deliver a steady stream of quality loans. … Read More

New Senderra Banks on Speed, Accuracy in Startup

A startup mortgage bank is eyeing a big role in the subprime market with a strategy that will use technology to deliver quick loan decisions to brokers. “Our motto is three words: ‘prompt, simple, and friendly,’” said Charles “Brad” Bradley of North Carolina Senderra Funding. Headquartered in Charlotte, the wholesaler is currently offering nonprime loans in 10 states, including Florida, Indiana, Maryland, Michigan, Minnesota and the Carolinas, with plans to add 10 more within… Read More

Mortgage Fraud Still on the Rise, MARI Tells NHEMA

Despite the best efforts of industry groups to get their arms around the problem, mortgage fraud is on the rise, a new report from the Mortgage Asset Research Institute indicates. The report, which was commissioned by the National Home Equity Mortgage Association, highlights an issue that is quickly surpassing predatory lending on the list of industry concerns. While lenders have largely learned to cope with the demands of federal, state and local consumer protection… Read More

Paper Checks Still Favorite of Many Borrowers, Poll Finds

Many subprime mortgage borrowers haven’t climbed aboard the electronic payment bandwagon – yet. But a sea change could be coming, as homeowners increasingly look for better ways to manage their debt and protect their credit histories. That was one of the main findings to emerge from a recent survey commissioned by technology vendor Fort Knox National Company. The poll, conducted last month, asked 2,038 consumers to weigh in on their preferred method of paying a… Read More

Fed Hearings Will Probe Subprime Lending Practices

The subprime lending industry will be on public display next month, when the Federal Reserve Board convenes four hearings on the adequacy of its high-cost loan regulations. The Fed is calling the hearings under the Home Ownership and Equity Protection Act, which Congress passed in 1994 to curb predatory practices in the home-equity market by imposing additional disclosure requirements and limits on certain high-cost home loans. … Read More

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