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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Perspective who wrote (37775)	8/4/2005 2:17:22 PM
From: patron_anejo_por_favor	Read Replies (1) \| Respond to of 110194

>>They average 80% LTV, which surprised the hell out of me.<< That probably is true...they securitize and jettison the riskier stuff, so it's not on their books for long. Problem is that that's where their profits and cash flow lie (primarily) and as their report today shows, the profitability of that trade is drying up. Keep in mind also that as long as housing prices bubble up, their LTV will look "better" than it will in say another year when prices have rolled over. Falling tide exposing the nude bather, as it were..... I'd also take a very close look at the footnote on "LTV".... It's possible that they're trying to tighten up, especially if they think we're heading over the cliff. It'll be too late to save them, however. Finally, there are a lot of tricks used to get the LTV over 80 in any individual loan, to avoid the need for PMI. 2nd mortgages and other devices are frequently employed. Loantech has some insights on this I'm sure.

To: Perspective who wrote (37775)	8/4/2005 2:30:34 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

In the "wonder what's being reporting" category, when you see so called LTV of 70-80% for people with 600 like FICO scores, it just makes you wonder about the appraisals, doesn't it?