Oh my… Countrywide just set new rates (effective tomorrow)…

[Chris Scoreboard Johnston]

They are just raising rates to a ridiculous price to avoid having to say, “we are not loaning any money for the moment.” Once the secondary market unfreezes, rates will go back down. They will in the mean time take deals at ridiculous spreads, because like Arthur said, “I’m not stupid, I took the money.”

There is so much emotion in here that results in one over-reaction after another. I had been debating leaving due to the overly negative forum this has become, but maybe I will take on the challenge of trying to be the one contra voice in here.

You must keep level heads to make good decisions.

[lendingbubblecontinues]

nevermind

[lendingbubblecontinues]

nevermind

[lendingbubblecontinues]

nevermind

[bsrsharma]

They are just raising rates

On the flip side, they are offering  one of the highest rates on FDIC insured deposits to attract funds. Agreed,  they may fail. But you can get good rates while it lasts.  I may bite!

[bsrsharma]

They are just raising rates

On the flip side, they are offering  one of the highest rates on FDIC insured deposits to attract funds. Agreed,  they may fail. But you can get good rates while it lasts.  I may bite!

[bsrsharma]

They are just raising rates

On the flip side, they are offering  one of the highest rates on FDIC insured deposits to attract funds. Agreed,  they may fail. But you can get good rates while it lasts.  I may bite!

[(former)FormerSanDiegan]

Bugs – Why do you think that rates will rise as we go through the second wave of ARM rests in a couple years.
Won’t the current wave of resets (which peaks this fall) do enough damage to the overall economy that rates would tend to drop (at least short-term rates) ?

[(former)FormerSanDiegan]

Bugs – Why do you think that rates will rise as we go through the second wave of ARM rests in a couple years.
Won’t the current wave of resets (which peaks this fall) do enough damage to the overall economy that rates would tend to drop (at least short-term rates) ?

[(former)FormerSanDiegan]

Bugs – Why do you think that rates will rise as we go through the second wave of ARM rests in a couple years.
Won’t the current wave of resets (which peaks this fall) do enough damage to the overall economy that rates would tend to drop (at least short-term rates) ?

[LA_Renter]

Chris,

in regards to “Once the secondary market unfreezes, rates will go back down”

Right now the secondary market is frozen due to market losses on mortgage and other derivatives which merely anticipate the actual credit losses from defaults and foreclosures, the markets will not know the true magnitude of these actual losses until late 2008. That is the key problem here. Until the market can determine with any accuracy the degree of what these losses are the secondary market will remain frozen. That will more than likely continue for the balance of this year and into much of next year. This is not a temporary blip. I guess I would like to know why you think the markets will become unfrozen in the near term or what time line are you speaking of?

[LA_Renter]

Chris,

in regards to “Once the secondary market unfreezes, rates will go back down”

Right now the secondary market is frozen due to market losses on mortgage and other derivatives which merely anticipate the actual credit losses from defaults and foreclosures, the markets will not know the true magnitude of these actual losses until late 2008. That is the key problem here. Until the market can determine with any accuracy the degree of what these losses are the secondary market will remain frozen. That will more than likely continue for the balance of this year and into much of next year. This is not a temporary blip. I guess I would like to know why you think the markets will become unfrozen in the near term or what time line are you speaking of?

[LA_Renter]

Chris,

in regards to “Once the secondary market unfreezes, rates will go back down”

Right now the secondary market is frozen due to market losses on mortgage and other derivatives which merely anticipate the actual credit losses from defaults and foreclosures, the markets will not know the true magnitude of these actual losses until late 2008. That is the key problem here. Until the market can determine with any accuracy the degree of what these losses are the secondary market will remain frozen. That will more than likely continue for the balance of this year and into much of next year. This is not a temporary blip. I guess I would like to know why you think the markets will become unfrozen in the near term or what time line are you speaking of?

[Ozzie]

I agree that jumbo rates will come back down. CFC is in the lending business. The liquidity crunch will play out and there will be other lenders that will jump at the chance to undercut the rate gouging practices of Angelo and co.

This entire “credit crunch” is not really about subprime borrowers. It’s about the gamblers on Wall St. who made 1000 bets on every subprime mortgage and that multiplied the underlying, crappy asset. The creation of these derivatives and the inability of the rating agencies to be able to judge their actual worth (or to look the other way as they collected their fees and rated them as “A+ paper” so the traders could sell them) magnified the situation even further. A lot of people here harshly judge the borrowers who took out loans they couldn’t repay and I have no problem doing the same, but I have more contempt for the Wall Streeters who are getting killed.

[Ozzie]

I agree that jumbo rates will come back down. CFC is in the lending business. The liquidity crunch will play out and there will be other lenders that will jump at the chance to undercut the rate gouging practices of Angelo and co.

This entire “credit crunch” is not really about subprime borrowers. It’s about the gamblers on Wall St. who made 1000 bets on every subprime mortgage and that multiplied the underlying, crappy asset. The creation of these derivatives and the inability of the rating agencies to be able to judge their actual worth (or to look the other way as they collected their fees and rated them as “A+ paper” so the traders could sell them) magnified the situation even further. A lot of people here harshly judge the borrowers who took out loans they couldn’t repay and I have no problem doing the same, but I have more contempt for the Wall Streeters who are getting killed.

[Author]

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