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> The last crisis was also heavily related to sub-prime mortgages. How much has sub-prime lending been mitigated? http://www.qualifiedhomeloans.com/campaigns/

> The last crisis was also heavily related to sub-prime mortgages. How much has sub-prime lending been mitigated? http://www.qualifiedhomeloans.com/campaigns/statedincomeloans/?gclid=CKG0g4ity84CFUGSfgoduV0GvA http://www.qualifiedhomeloans.com/campaigns/statedincomeloan... http://www.forbes.com/2010/07/02/return-liar-loans-personal-finance-no-doc.html http://www.forbes.com/2010/07/02/return-liar-loans-personal-... No. Its still essentially the same with no paperwork mortgages with higher interest rates and ARMs. Very little changed other than a few regulations that might stop a systemic collapse of large banks. > Thankfully, I live in an area that didn't see the enormous run up of house values. The crash affected our housing and we still had the normal negative effects of a big recession. Housing prices have certainly recovered by now and I do wonder how much of it is still smoke and mirrors. But in markets like Florida and Arizona where house prices got really out of control, have those areas also recovered? That would be more shocking to me. http://www.tradingeconomics.com/united-states/case-shiller-home-price-index/forecast http://www.tradingeconomics.com/united-states/case-shiller-h... The market as a whole is almost back to where it was in 2008.

Domenic_S 10y ago
You can't read that Forbes link and say "no" if you know a little bit about finance: > Wall Street Funding of America [...] circulating offers to make low-doc loans to borrowers with credit scores as low as 660 FICO, as long as the borrower was self-employed, seeking no more than 60% of the value of a home and had six months of mortgage payments in reserve. 660 FICO is not sub-prime by any standard, and it requires 40% down AND substantial reserves. That risk profile is great, and 180 degrees away from the old stated-income loans. Anecdata: I've opened 4 mortgages since the crash, 1 with a big bank and 3 with smaller lenders. Every one of them required substantial and verified documentation, and my FICO is just under 800. Lending is nowhere close to the craziness it used to be!
- sokoloff 10y ago
  > 660 FICO is not sub-prime by any standard Experian buckets 740-830 as "super prime" and 680-739 as "prime". I'm not aware of any credit agency that buckets 660 as "prime" (or better). Some mortgage originators consider 670-690 and no 30-day lates in the last year as "near prime". 660 is indeed "sub-prime", IMO.
- fweespeech 10y ago
  You do realize the other link is a stated income / no doc loan right? http://www.bloomberg.com/news/articles/2015-01-28/get-ready-for-the-return-of-risky-mortgage-bonds-credit-markets http://www.bloomberg.com/news/articles/2015-01-28/get-ready-... > Angel Oak is willing to buy loans with credit scores as low as 500, though the average has been about 670, just below the 680 level some use as a cut-off for subprime on a scale of 300 to 850, Hsu said. The company makes sure borrowers can afford the payments and requires at least 20 percent down payments, he said. 660 is subprime.
  - Domenic_S 10y ago
    That is not a no doc loan. You conveniently left out the very next sentence: > The company makes sure borrowers can afford the payments and requires at least 20 percent down payments, he said. "makes sure borrowers can afford the payments" is code for "documentation required". What's more, 20% down gives good capitalization and is hardly sub-prime (as a loan product). Low-score low-down FHA loans have existed for a long time and are not a cause for concern -- mortgage insurance is required and offsets the risk, unlike the crazy balloon ARM products of the bubble.
    - fweespeech 10y ago
      http://www.qualifiedhomeloans.com/campaigns/statedincomeloans/?gclid=CKG0g4ity84CFUGSfgoduV0GvA http://www.qualifiedhomeloans.com/campaigns/statedincomeloan... Did you really not read the first link I gave you which is a stated income loan? You are very interested in convincing me you are right when I know these no doc places exist and know people who have loans with them. I was simply correcting your belief that 660 was not "subprime".
      - Domenic_S 10y ago
        Dude, come on. Embedded youtube video that doesn't exist anymore, 2000s-era site -- you really had to scrape the bottom of the barrel to find that page. See my sibling comment, most lenders don't consider 660 subprime.
- Domenic_S 10y ago
  For those confused on what sub-prime fico scores are: "Historically, subprime borrowers were defined as having FICO scores below 640" -- https://en.wikipedia.org/wiki/Subprime_lending#cite_note-Lo-2 https://en.wikipedia.org/wiki/Subprime_lending#cite_note-Lo-... "550-620: Subprime." -- http://www.credit.org/what-is-a-good-credit-score-infographic/ http://www.credit.org/what-is-a-good-credit-score-infographi...

Domenic_S 10y ago

You can't read that Forbes link and say "no" if you know a little bit about finance: > Wall Street Funding of America [...] circulating offers to make low-doc loans to borrowers with credit scores as low as 660 FICO, as long as the borrower was self-employed, seeking no more than 60% of the value of a home and had six months of mortgage payments in reserve. 660 FICO is not sub-prime by any standard, and it requires 40% down AND substantial reserves. That risk profile is great, and 180 degrees away from the old stated-income loans. Anecdata: I've opened 4 mortgages since the crash, 1 with a big bank and 3 with smaller lenders. Every one of them required substantial and verified documentation, and my FICO is just under 800. Lending is nowhere close to the craziness it used to be!

sokoloff 10y ago
> 660 FICO is not sub-prime by any standard Experian buckets 740-830 as "super prime" and 680-739 as "prime". I'm not aware of any credit agency that buckets 660 as "prime" (or better). Some mortgage originators consider 670-690 and no 30-day lates in the last year as "near prime". 660 is indeed "sub-prime", IMO.
fweespeech 10y ago
You do realize the other link is a stated income / no doc loan right? http://www.bloomberg.com/news/articles/2015-01-28/get-ready-for-the-return-of-risky-mortgage-bonds-credit-markets http://www.bloomberg.com/news/articles/2015-01-28/get-ready-... > Angel Oak is willing to buy loans with credit scores as low as 500, though the average has been about 670, just below the 680 level some use as a cut-off for subprime on a scale of 300 to 850, Hsu said. The company makes sure borrowers can afford the payments and requires at least 20 percent down payments, he said. 660 is subprime.
- Domenic_S 10y ago
  That is not a no doc loan. You conveniently left out the very next sentence: > The company makes sure borrowers can afford the payments and requires at least 20 percent down payments, he said. "makes sure borrowers can afford the payments" is code for "documentation required". What's more, 20% down gives good capitalization and is hardly sub-prime (as a loan product). Low-score low-down FHA loans have existed for a long time and are not a cause for concern -- mortgage insurance is required and offsets the risk, unlike the crazy balloon ARM products of the bubble.
  - fweespeech 10y ago
    http://www.qualifiedhomeloans.com/campaigns/statedincomeloans/?gclid=CKG0g4ity84CFUGSfgoduV0GvA http://www.qualifiedhomeloans.com/campaigns/statedincomeloan... Did you really not read the first link I gave you which is a stated income loan? You are very interested in convincing me you are right when I know these no doc places exist and know people who have loans with them. I was simply correcting your belief that 660 was not "subprime".
    - Domenic_S 10y ago
      Dude, come on. Embedded youtube video that doesn't exist anymore, 2000s-era site -- you really had to scrape the bottom of the barrel to find that page. See my sibling comment, most lenders don't consider 660 subprime.
Domenic_S 10y ago
For those confused on what sub-prime fico scores are: "Historically, subprime borrowers were defined as having FICO scores below 640" -- https://en.wikipedia.org/wiki/Subprime_lending#cite_note-Lo-2 https://en.wikipedia.org/wiki/Subprime_lending#cite_note-Lo-... "550-620: Subprime." -- http://www.credit.org/what-is-a-good-credit-score-infographic/ http://www.credit.org/what-is-a-good-credit-score-infographi...