Basically it points out that the Prime sector, due to its size and expected stability, is the key driver.
It will be interesting to see just how “prime” those loans are. I heard somebody talk about how some prime loans didn’t have properly documented income. Mortgage brokers would first run the loan through the computer and sometimes the computer would allow a prime loan to be made, without income verification. Then they could make a no-doc loan, and have it be prime as well. I guess we’ll find out if this is a rumor and if it did happen, how often.
