Chicago, Illinois -- (ReleaseWire) -- 08/22/2007 -- Despite turmoil in the credit markets, where the irrational knee-jerk reaction is to limit the availability of both prime and sub-prime money to lend to home owners, one lone voice in the sub-prime mortgage lending industry is standing firm against this hysteria and is adamant that, “those who say that sub-prime is ‘over’ are sadly mistaken!”
This controversial statement comes from outspoken & unconventional consumer advocate & sub-prime mortgage industry veteran & expert, Scott Tucker. Tucker has been involved in sub-prime lending since its infancy.
According to Tucker, “in spite of the current loss of available credit from sub-prime lenders, sub-prime borrowers are still able to obtain financing through the very same ‘sub-prime’ mortgage loan officers they’ve always relied upon!”
“This is so because those sub-prime loan officers can still write sub-prime borrowers FHA-insured loans through their FHA-approved brokers!” Tucker says.
He continues, “this ‘credit crunch’ is nothing more than a temporary glitch. Sub-prime lending is not going anywhere long-term. Sub-prime mortgages are present in 1/4 to 1/3 of U.S. households. Credit availability to sub-prime borrowers, from sub-prime lenders, will return, but it will be another 30 to 90 days before investors in sub-prime mortgage-backed securities come to their senses and again are willing to purchase additional sub-prime mortgage-backed securities.”
“It’s a great time to snatch-up these sub-prime mortgage-backed securities at deep, deep discounts,” Tucker continues. “Investors in sub-prime mortgage-backed securities didn’t seem to know before, nor want to know, what they were investing in,” Tucker says.
“Sub-prime mortgages are seeing a 4% ‘delinquency’ rate this year versus the normal & customary 3% ‘delinquency’ rate,” says Tucker.
“The ‘delinquency’ rate is not the same as the much lower ‘foreclosure’ rate. ‘Delinquent’ borrowers are just late & slow payers. Most of these borrowers catch-back-up, and fall-behind again. Over-and-over again. It’s just their habit to do so. The same way some other people might have some other odd habit. The great majority of those 4% who are ‘delinquent’ do not go into foreclosure,” Tucker says.
“Sub-prime borrowers always have, and always will, pay late or pay ‘slow,’ in greater proportion than prime borrowers. That shouldn’t be ‘news’ to anyone! I can’t see how investors are ‘surprised’ at this quite normal performance in these sub-prime mortgage-backed securities,” says Tucker.
Tucker continues, “sub-prime lenders always have, and always will, price that ‘risk’ into the interest rates & the late fees assessed. It’s just that in 2006, investors over-paid for the sub-prime mortgage-backed securities they purchased. And now they’re disappointed, because they counted their chickens in excess.”
But with this recent correction, the market is now healthy again, and the speculative investors have had their ‘attitudes adjusted’ about what these securities are really worth, and what they can reasonably be expected to return to them. But these sub-prime mortgage-backed securities most certainly are not ‘worthless!’” says Tucker.
“These sub-prime loans are still being honored. They are not in what I would call a high-rate of default. The media acts as if 64-million Americans suddenly turned-in their house keys. They have not,” Tucker says.
Tucker concludes, “In the last week the Fed has provided $88 billion in liquidity to the markets, snatching-up mortgage-backed securities like mad. They’ve made that very same $88 billion in-turn available to lend again to home owners.”
“And the European Central Bank has put in $283.2 billion in liquidity of its own. There’s another $283.2 billion available to be lent again. And all the while ‘they’ say that the sub-prime mortgage industry is ‘dead-in-the-water.’ Nonsense.”
To interview Scott Tucker on sub-prime mortgage lending, please fax him at 773-327-2842, and he’ll get back to you within 24 business hours. To learn more about Scott Tucker and his marketing System for sub-prime loan officers & mortgage brokers, please go to http://www.MortgageMarketingGenius.com.