SoCalBubble reports on the crisis many homeowners will be facing when their much higher balloon mortgage payments kick in. Most had planned to refi to avoid the balloon, but with the recent tightening of loan standards, they won’t be able to refi or make the new, much higher payments. This, in turn, will trigger a wave of foreclosures.
Lots of subprime mortgage companies are going under, it’s just a matter of time until the first bank failure.
New Century Financial, the second largest subprime lender, has just cratered, will default on billions of dollars in loans and leave many large investment banks with mortgage portfolios worth pennies on the dollar. Their website admits that, well, they were just making shit up.
The financial information related to the quarters ended March 31, June 30 and September 30, 2006 should not be relied upon and is included on this Web site for historical archive purposes only.
A new shade of blue chip? What color is a cesspool?. Their stock has been suspended from trading and criminal probes are coming. Like they and the investment banks didn’t know they were selling garbage mortgages, but as long as they could make fat profits, they let the charade continue. The short-sighted greed of capitalism has created another bubble that just exploded, one which will leave lots of collateral damage in its wake.