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Converted Lurker

Sub Prime Rates For Non-conforming Mortgages Have Now Breached The 10 Per Cent Mark

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John Charcol has noted that UK three month LIBOR has fallen back to 6.25 per cent, with more conservative product ranges entering the market - showing signs that the crisis is beginning to level off.

Katie Tucker of John Charcol is however concerned that the non-conforming market is "growing into its new skin of lower LTVs and higher pricing" leaving borrowers stuck with rates edging into double figures...

http://firstrung.co.uk/articles.asp?pageid...&cat=44-0-0

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John Charcol has noted that UK three month LIBOR has fallen back to 6.25 per cent, with more conservative product ranges entering the market - showing signs that the crisis is beginning to level off.

Katie Tucker of John Charcol is however concerned that the non-conforming market is "growing into its new skin of lower LTVs and higher pricing" leaving borrowers stuck with rates edging into double figures...

http://firstrung.co.uk/articles.asp?pageid...&cat=44-0-0

This really hacks me off ... the only reason LIBOR has fallen back is because the B%stards are borrowing from the ECB ... anyway, I'd love to know just how big the "non conforming" market is.

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This really hacks me off ... the only reason LIBOR has fallen back is because the B%stards are borrowing from the ECB ... anyway, I'd love to know just how big the "non conforming" market is.

On yesterday's PM Ray "Trouser" Boulger reckoned 250,000 "Heavy Adverse" non-conformists soon/already stuck on 10-11%...

With another 750,000 less exposed sub-primateers.

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It's no good the more "prime" borrowers ostracising these people and asserting that they can go to hell but our position will be unaffected. Cast out 10% of all buyers from the market - squeeze the same proportion of mortgagors and all of a sudden the supply/demand balance shifts considerably, knocking the bottom out of the entire market.

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It's worth pointing this out.

LIBOR is a calculation of loans rates that are actually being made, they give no indication of how much money is being lent or for what. What I'm seeing (and CL can help me out with this) is banks are only raising money now for higher quality debt which still has goodish rates.

On a related note, leveraged buyouts have all but stopped now.

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On yesterday's PM Ray "Trouser" Boulger :lol::lol: reckoned 250,000 "Heavy Adverse" non-conformists soon/already stuck on 10-11%...

With another 750,000 less exposed sub-primateers.

So assuming the other 750,000 are already perched precariously close to the rim of the toilet seat, thats approximately 1 in 20 ... don't want to see people kicked out of their homes but it'll do for me.

Once this does become a mainstream problem here in the "Land of Economic Miracles", credit can only tighten further, thus possibly pulling those just above sub-prime into the mix ???

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On a related note, leveraged buyouts have all but stopped now.

aye, so I dunno how Branson thinks he'll raise the money to buy NRKs debts.

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Indeed. All these potential hedge funds and private equity firms have an uphill struggle raising the capital for Northern Rock. They seem to agree it's worth £750m. But like FTBers, it's raising the money that's the problem.

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It's worth pointing this out.

LIBOR is a calculation of loans rates that are actually being made, they give no indication of how much money is being lent or for what. What I'm seeing (and CL can help me out with this) is banks are only raising money now for higher quality debt which still has goodish rates.

On a related note, leveraged buyouts have all but stopped now.

TBH I'm not sure there's enough prime business around to satisfy banks, unless we all get in a big fukc off tardis and set it for 1974 with 6 or 7 lenders and you get in a 3 month queue for an appointment with the friendly BS manager. This rush to quality has severe implications for lenders, irony is most prime customers already have a mortgage and will probably stay put :blink: . I still contend that the circuit is broken at both ends; lenders struggling to borrow, MBS buyers/players not much appetite for new debt, prime or not. Majority of willing customers are sub prime and there is product there for the desperate. However, do the 'MBS boys' really want bonds chocka full of default already built in? Cos sure as eggs is eggs the majority of sub prime customers default later on down the track. You can't chase the market down chasing after 'quality sub prime' :lol: paying 4-5% over base...

Edited by Converted Lurker

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