The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: Elroy Jetson who wrote (31387)	5/17/2005 11:37:52 AM
From: Valuepro	Read Replies (1) of 306849

Elroy, "But Downey sure seems to be asking for a bad accident." Did you see the APR? They make it on fees, then bundle their loans and sell them, jut like all the other lenders. I'm guessing that because the rate is low, Downey adds back part of the fees to make the loans look more attractive for sale. In the end, they may not be making any more per individual loan, but they may dramatically increase volume (and fees) among all those borrowers who think they are making a good deal (as if fees are not a cost). Risk is passed to those who buy the loans.

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