PR I don’t think I said that rates are going up. My main concern is the uncertainty with the risk premiums that will be built in by the lenders. Your post makes good sense except that I am pretty sure a very high percentage of loans are sold on the secondary market. Even those in the class 2 example. Even so called direct lenders must resell loans otherwise they could not continue to do business. So basically I agree with your posts and my point is that Extra 1, Extra 2, and Extra 3 will be totally driven by the secondary market. It will be interesting. I think your numbers make good sense for now. Let’s see how they hold up.
