Each category -- first mortgages, home equity installment (HE) loans and home equity lines of credit (HELOC) -- showed significant increases in subprime
originations over the same period a year ago.
While the FHA was still offering favorable mortgage terms for qualified borrowers, subprime
lenders were offering a much easier and faster application process, at times with no down payment requirement.
Following Morgan Stanley s disclosure in November 2007 of several billion dollars in write-downs relating to a trading position in subprime
securities, plaintiffs filed a class action alleging that Morgan Stanley and the individual defendants violated Section 10(b) of the Securities Exchange Act of 1934 by (1) misrepresenting Morgan Stanley s risk controls relating to monitoring its subprime
trading positions, (2) misstating and omitting information regarding the extent of Morgan Stanley s exposure to subprime
-related assets, including one of Morgan Stanley s subprime
trading positions, and (3) overvaluing that subprime
trading position in Morgan Stanley s third-quarter 2007 financial results.
Unfortunately, many of the most popular explanations that have emerged for the subprime
crisis are, to a large extent, myths.
While they may have skirted the worst of the subprime
crisis so far, Japanese financials still have a hefty exposure to securitised products overall, the data showed.
As a result, Mitsui Life will report a net loss of several billion yen for the 2007 business year, becoming the first major Japanese life insurer to see its net balance sink into the red due to subprime
mortgage-related woes, the sources said.
ARM loans, there were approximately 13,000 loan modifications and 90,000 repayment plans established in the third quarter.
One of the main questions that the agencies ask is whether subprime
mortgages are "inappropriately risky.
PRINCETON, NJ -- In a speech last week before the Federal Reserve Bank of Chicago's 43rd Annual Conference on Bank Structure and Competition, Fed Chairman Ben Bernanke addressed the topic of the subprime
mortgage market and its potential impact on the residential real estate market.
Titled, "Losing Ground: Foreclosures in the Subprime
Market and Their Cost to Homeowners," the CRL study is the first comprehensive, nationwide review of millions of subprime
mortgages originated from 1998 through the third quarter of 2006.
A critical report released last year by the National Consumer Law Center asserted that subprime
loans have been a primary contributing factor in the increase in foreclosures and "rescue" scams across the country.
But the surge in subprime
mortgages is also creating new forms of risk to subprime
borrowers, holders of securities backed by subprime
mortgages, and potentially the wider marketplace of housing finance.