Home : Blogs : Jason Sardi, Mortgage Banker : Real Estate Financing, The Insider's Insight On Mortgage

So how are the 'Nonprime' Mortgages fairing across our nation?

There is an interesting website that many of you may not be familiar with: Federal Reserve of New York, that I will share briefly.

'Nonprime' Mortgages, lovingly referred to more often these days as 'Subprime' Mortgages have long been the scapegoat as the catalyst for what is going on in the Real Estate Industry. Now, in this humble author's opinion, to lay a bulk of blame on Subprime Mortgages is a shortcut to thinking. I think the scope of the problem was and is well above these particular products.

So, for you statistical junkies out there, you could have a lot of fun with this site and come up with your own conclusions. Even more than that, it can help guide us to smarter decisions in the Mortgage Industry as we explore some of these statistics locally & nationally. While I don't have the time or patience to breakdown these stats for our entire Nation at this moment, I will give a brief overview of some statistics that I found compelling in my home turf here in Pennsylvania. These stats were as of Sept 2008. Here we go:

18.1 Loans per 1000 housing units were Subprime Mortgages.
1.5 Subprime Loans were in foreclosure per 1000 housing units.
Median Combine Loan-To-Value of homes with a Subprime Mortgage was 85%.
Share low or no documentation for Subprime Mortgages was 24.1%

There are a lengthy amount of statistics there and I urge you to more than just peruse them when you get the time. Here is the link to the site. You can make your own analysis from there.

Now before you go and engulf yourself in the vastly entertaining workings of Statistics 101, I want to point out a specific section of that site that is crucial for ALL of us going forward. The New York Fed has a section called . If you click on Education and scroll down, you'll find a link that says, "Financial Education for ALL". This may not be as exciting a read as our President's Speechwriter... yet chip away at some articles that will hopefully give you better insight behind the proverbial curtain. You will find breathtaking reads on "You and the Fed"... enthralling prose in "Interest Rates: An Introduction" and a literary dollop of creative meanderings with "The Credit Process: A Guide for Small Business Owners." Seriously, this is some good stuff to chew on and perhaps the most important section of this site for consumers and our budding students ready to make their splash in the Real World they've heard about.

It only takes a few steps at a time to take your financial life into your hands. Information is out there, use it!

Posted by Jason Sardi, Mortgage Banker on 10/31/2008 02:50 PM

Comments (48)

Subprime in the ActiveRain Channel

federal reserve of new york, subprime mortgages, pennsylvania mortgages, pennsylvania mortgage brokers

Originally posted at: Real Estate Financing...: So how are the 'Nonprime' Mortgages fairing across our nation?

Post is included in group: All About Mortgages/Mortgage Networking
Post is included in group: Bloggers Choice Selections
Post is included in group: Investors
Post is included in group: Mortgages
Post is included in group: Realtors®

48 Comments on So how are the 'Nonprime' Mortgages fairing across our nation?

OCT

2008

I'd love to see what's behind that 'proverbial curtain'! wink wink ;-)

Great post and intriguing site!!

Interesting numbers. It does not appear that many of the loans are trouble loans. So why is economic news based on the small percentage of the whole? Bad news sells.

Jason - thanks for sharing the info ! I will check out the site over the weekend. Definitely some interesting numbers on subprime (or nonprime) loans. Certainly the numbers there are pretty minimal due to the massive global problems... definitely some things missing.

Thanks Jason, It's interesting just how much information the government has; and much of it is avialable for public view. For those who are willing to take the time the data will change your mind about what's going on in the markets.

Parked, Gotta head to the house to pass out candy. Coming back for this article. I know I need to know this info :)

Just me again... wondering if you will add an edit to this post showing us how and where to find specific data for our own state. I've been playing around with this site and I guess I'm not as smart as you after all, because I can't find it.

The statistics actually don't seem that crazy to me unless I am missing something?

Jennifer - Click on the site and it should bring up a map of the United States. Just click on the state you want to check out and it should bring up the applicable statistics for that state.

Audrey - Okay, have fun passing out candy!

John - Yes it is. I found some of these stats rather intriguing compared to what we tend to hear in the media.

Chris - I'd be anxious to hear your thoughts. Enjoy your weekend!

Heath - Bad news sells, reality enlightens and help us learn the right way.

Jennifer- Ssshhhhhhh;)

Bill - No they don't. I'll look over them a bit more in depth over the weekend though. After first view, it seems the bark was greater than the bite in regards to the hype.

Jason - Very interesting..I saw that here 56.4% had a late payment in the last 12 months. Now, that number did surprise me.

Jason, when you look at 1.5 out of 1000 subprime in trouble it almost says this is purely "noise level" stuff so why worry about it?

Thanks Jason, I will check out this site. I know my county has not been hit quite as hard as others in California and I'm sure this will help give me some additional perspective with respects to the rest of the country. HAPPY HALLOWEEN!

Sandra- It will be interesting to see the actual numbers across the board and then break them up locally and regionally. Where are the boys over at Castellum Realty when you need them?

Gary - I think there should still be concern, though the feathers that were ruffled may have been a bit softer than the smoke we were inhaling.

Greg - It should come in handy, you should use this info as well for some of your clientele. Happy Halloween to you, my friend.

Jason, first, I'd like to publicly thank you for calling today and for trying to help my fellow agent Leann. She thought your advice was invaluable and I hope we will be doing business with you in the future! You are great.

This was very well written. Thanks so much for always keeping us informed.

Hi Jenn!

I think all of us that dig into this know that it was deeper than just subprime... but the drive-by media needs to have a simple target for the blame.

NOV

2008

When I bought my house, I needed a stated income loan; being a single mom and self employed- and we still make our house payments. I even have a high interest rate and I still pay. I love my home, and it is a home, not a commodity to us. And we did not use it for an ATM machine. I think there are good folks out there like me who needed this type of loan and are NOT in foreclosure!

Hi Jason- I was using banknote to learn about financial stuff, so maybe I'm ready for this site :) Thanks for the link, now if I could just get my firefox to download and run the player :(

Fine sight, Jason, and chocked full of data. If you browse through states arbitrarily you'll find that many counties are not included, therefore not a comprehensive look at the state as a whole. Tennessee data reflects data in small counties. Without a much more thorogh and comprehensive overview of the statistics, I believe it lacks exhaustive analytical conditions for accurate statistical reporting. First American Core Logic, who performed the analysis, states in it's company fact sheet that their analysis covers "140+ million properties in over 3,000 counties covering 99% of the US population. The analysis doesn't reflect this.

Most every county I reviewed, for my state, in the flash player, reports that the information for that particular county isn't available. Subsequently, the question arises as to just exactly what is represented and how comprehensive of an overview is it of the country, the county, or the particular state in general ? Just a passing thought. Hope your having a fine weekend.

I love your "play on words' description of "not so pretty loans" and I hope you enjoyed "Halloween" and that things are improving in your part of the world! Have you voted yet?

Rock on my friend!

Susan - I appreciate that and no problemo. Have a good weekend!

Lane - 'Drive-by' Media... shoot, I could turn that into a comic catchphrase. Well put!

Katerina - Stated Income Loans are almost dead. Now, out of fairness, some will argue that if you aren't reporting your total wages and have to 'State' your income to the government and aren't paying your share of the taxes... you don't deserve a loan in the first place. Let me take a stab at those naysayers for a moment...

My guess is that Katerina pays Real Estate Taxes way before they are due...
My guess is that Stated Income Loans have performed better than some would have you believe.
My guess is that the Lenders and Banks have no business caring about taxes, other than making sure their borrower is paying the Real Estate half of it. Oh wait, I'm wrong there... the Federal Government owns these Instituitions.
My guess is that our Tax Structure and Code are a joke and we may want to think about throwing a bunch of Lipton Teabags into the body of water most near to us.
My guess is that I'm a cynical little twit, with a pretty tidy point.
My guess is that I pay Real Estate Taxes (actually, that one isn't a guess)

We need more Portfolio (lend and hold & service anything they lend) Lenders. If they understand the difference between a good loan and a bad loan, they are liable to make some decent money while serving a public that is now deemed undesirable by Government Lending Standards.

Kathy - When your firefox starts working, let me know what you think.

David - I just knew someone like you would come to visit:) You bring up some interesting and relevant points. There are a few counties I searched in Pa and there was 'no data available.' To an extent, this site reminds me of the kind of data I would accumulate as a pollster wanting a certain candidate to win. You should check out the education section though, it is pretty good. Your passing thought presents interesting and valid concerns about statistical data. I had an Economic Teacher in College who said, "Statistics can lie, you can make them be whatever you want them to be." Personally, I don't rely much on statistical data. I just talk to my neighbors, co-workers, friends and family - that tells me what statistics can't won't.

Russell - If things were any better, I'd be sipping hints of a Martini through a strange looking straw.

Jason, I work with Russell and it's fun to see his humorous side because he is also a very serious individual when it comes to business. He has spoken about you around the office and you two appear to be of "Like Mind".

Anne - Russell seems to be the epitome of someone I would be honored to work with, whether I am a Consumer or Fellow Professional. To boot, I think we could have a beer together and tear up the town. I like that sort of multi-faceted relationship;)

It has more to do with the real-estate market "tanking" than the subprime loans. That's why the banks are in trouble. Freddie and Fannie would have eventually collapsed the second the market tipped downward, which is what happened. Now it gives politicians an excuse to meddle in the biz more and make things worse the next time it happens.

----------------------------------------------------------------------------------------------------------------

We are a BPO data entry firm servicing Realtors and REO offices. We have 5+ years of data entry experience and commitment to detail and accuracy. Prompt and professional service. We offer a trial 5 order period for free. We also offer photo taking service for the Greater Cleveland Area. The Data Entry service is nationwide.

Send us the comps, we'll take care of the rest while you use your time to sell, list, and handle other important business matters.

Thank You.

Jay - Contact me @ 610-653-0317 so I can ream you a new "hole" because you are nothing more than a commodity that isn't much needed. You'll probably never read this... but your Marketing sucks! I will give you $1500.00 just to have you quit that shit. Deal?

Can I quit something for $1500??? Gosh, I could then go to NAR 2008 and hear Jeff Turner & that whole gang of heroes that I worship! (BTW, excellent writing here. I don't have a keen mind for money matters, but I know this is just really good stuff here!)

Jason...and your fear the testicles of Jeff Belonger?? No way you that fear much of anything!! I am laughing so hard at your comment to "Jay" and have to tell you that i would step in with you anytime the going got rough! The more I know you the more I like you...Rock on and happy Halloween too... (we celebrate all weekend here in Austin! Russell-El

Jason,

Yes I did read it and if you are willing to give me $1500 to not contribute to the discussion, by all meens, go ahead. As for the marketing tag I have on my blog responses, don't read it. But it's for anybody that may need help in their business.

I'll wait to call you to see if you can be civil first. How about responding to my comment on the actual topic and not attacking my "s**t marketing." That marketing has gotten me quite a bit of business and I could care less what people think of it. Dollars matter and Talk is cheap.

Hope you take the time to respond to the comment, I'd love to hear what you have to say. Your original post was interesting and informative and I'd hate to have you ruin it with a total lack of courtesy and maturity.

Thanks and if you have any questions feel free to contact me at jayallen@bpodatex.com

I'll spare you the marketing sig. tag this time as to not stress you out too much.

Jay Allen Lindner

Oh, and..........deal. You can send the check to P.O. Box 613 Lorain, OH 44052.

Make it out to Jay Lindner.

Thanks again.

Jason, I find it very annoying that people comment on our posts only as a way to market their business.

I also disagree with Jay's premise that it has more to do with real estate tanking than the sub prime mess. Real estate tanked, in my humble and 23 year opinion, because so many people had seconds and even third mortgages in the 80/10/10's or 90/5/5/ or whatever the heck they did, that had adjustable rates that went up and they could no longer afford their homes. The glut on the market of people trying to sell these same homes, the banks trying to sell the foreclosed upon homes and short sales made real estate tank.

Also, when someone uses the term "by all means" he should spell it correctly. Also, since this guy seems to be doing so well in his chosen profession, what with his marketing "getting him quite a bit of business", save the $1500 for yourself and have a lovely weekend sweetie!

Well Susan, and nice to meet you by the way, thank you for at least addressing the issue I was posting about.

I know in being heavily involved in a very high REO market in East Cleveland that most of the foreclosures were "fixed-rate" mortgages. I agree that variable-rate mortgages did cause problems for many homeowners, but refinancing and having very little DP in the property to begin with was a bigger factor. The banks leveraged heavily on two things. 1) that the values would stay up and that they could easily unload a foreclosure quickly and still make money. 2) they believed the government when they said they had their backs if they loaned (forced in most cases) to low-income people that could not afford to have a mortgage. They gave many mortgages to investors with little money down too. I've watched many of them lose them all too. When you have a federal reserve that just put the rates at 1%, that's pretty telling too that they've mismanaged the financial market.

I do apologize for committing the "spell-check" disaster, I know it's a source of great stress and turmoil for many and I guess it comes from all those MLS sheets I read everyday that are usually missing data on them like Square Footage, Lot Size, and even how many rooms are in the building, but nobody's perfect.

Hey, don't tell him that................we had a deal!!! ;)

Yes I agree, it's very rude and unacceptable to share and market ideas, services, and business on a real-estate networking site. It's better to just "chum" around and not accomplish anything and feel good doing it.

Thanks for the tip.

Well Jay, I can see by the amount of points you have that you are somewhat of a newbie here so I will overlook your "spell check disaster".

It is rude and unacceptable to share and market your ideas and services on another person's post. I'm glad you are a big enough man to admit that you were wrong.

The correct way to market yourself is through your writing, on your own post.

You can respond to this, or not, I don't really care as I will not be having any further dialogue with you.

Have a pleasant weekend.

Jason, I apologize for interfering in something you obviously had well under control.

Lindner - Well look now, you are contributing to the discussion. Bro, I don't mind you chiming in, yet it seemed and still seems that your original comment had nothing to do with the conversation and everything to do with making you a dime. Talk may be cheap, but so is your original comment. Add something then you've done something. It seems your particular services are to benefit REALTORS, not consumers or Mortgage Guys like me... at least directly. That's fine. Your comment seems to be designed to reach the REALTOR audience and not the author. So, I will leave your comment in tact. Maybe you will get business from it, who knows? As far as the $1500.00 check, don't hold your breath... you didn't quit the shit;)

One more thing, you mentioned Mr. Lindner something very noteworthy... at least I think it is...

"Yes I agree, it's very rude and unacceptable to share and market ideas, services, and business on a real-estate networking site. It's better to just "chum" around and not accomplish anything and feel good doing it."

It's one thing to share, another to spam. Hey, I will call you out on the latter... at least here. Craigslist & Backpage and other entities ... you or I can do that (Spam) all day long. But the beauty of this place, AR, is that it is the sharing of what is going on in our chosen profession. And everything should be as original as we can make it, including any discussion in the thread of the post. I'm going to check out your profile and posts here, Mr. Lindner. Of note, I wouldn't think of doing so had I not seen your comments after the original spam. And I don't "chum" around with anybody...;)

Jay - And in response to this point, "It has more to do with the real-estate market "tanking" than the subprime loans. That's why the banks are in trouble. Freddie and Fannie would have eventually collapsed the second the market tipped downward, which is what happened. Now it gives politicians an excuse to meddle in the biz more and make things worse the next time it happens."

Not a bad point. 100% Investor Loans, high LTV's for borrowers who showed a lack of compliance on other credit payments, no reserve (money in the bank) requirements, & borrowers buying multi-unit homes as 'owner occupied' through FHA then refinancing them into conventional loans so they could buy more homes under that guise... are just some of what caused all this in my opinion. Greed is a lofty goal, one that we've shown time and again... we can't handle.

"It seems your particular services are to benefit REALTORS, not consumers or Mortgage Guys like me... at least directly."

Exactly, so why would it be that important for me to market here?? All I was doing was skimming through different groups and checking out the topics being discussed and was interested in this post. That's all their is to it. Thanks for responding to the post I was making. That's all I was looking for.

As for Susan's comment, I really could care less if she engages in any conversation with me. My life will go on. Personally, by the insulting and immature comments she's leaving, it's quite alright. I wonder if she sells houses with that attitude? :)

That's the Jay I want to know! Easy on Susan though, just 'attack' me. I know, she came at you but still...

You chimed in and are above what was once thought of as spam. I will certainly listen to your marketing now, whether it makes me money or not. That seems fair.

One more thing Mr. Lindner, I love being passive... but not complacent. Enjoy your business.

*Wait, wasn't this post designed for consumers? Heck, if I was a consumer and reading this, I wouldn't want to do business with any of us. I'm just saying...*

NOV

2008

Well, Well...I do not know why someone would pick this blog to start a ruckus except to say that it's is a foolish thing to start something without knowing at least a partial list of consequences. I mean you do not just wade in and start swinging (except in certain unique circumstances) Newbie is one thing but this be ridiculous. Nice handling Jason and nice to see you step in for Susan though I feel sure she holds her own in any situation.

It is good knowing you my friend as well as many of the others I see hanging around your neck of the woods! Have a great week!

I'm not an expert in that field but the numbers seem suspect...I'd like to see them in a broader view.

NOV

2008

Russell, it was nice of Jason, but it wouldn't have been necessary, had I minded my own business. Jason, my sincere apologies for making the situation worse. And thank you sweetie. xxoo

Jason,

I will take a look at the site....however, the numbers you mention here do not seem to warrant the drastic steps taken recently by the GOVERNMENT......I will get back to you when I get through the link.

Thanks my friend.

Non-prime loans are simply the media hook to the larger picture. It's easy and safe to pick on a portion of the industry that doesn't exsist any more! The line between conforming and non-prime loans became more and more blurred as the last several years passed. In fact, (toward the end of Non-prime as we knew it) all our applications were run through the Fannie and Freddie approval engines BEFORE moving on to non-prime lenders regardless of ltv's, credit scores and payment histories. Many loans that years earlier were in fact non-prime were approved by these automated systems. Seems greed caused Fannie, Freddie and Non-prime lenders to forget who exactly their target markets were.

Fight nice Jason.....

What I've seen is properties in urban areas where most of the forclosures took place were being sold 3 and 4 years ago for $70-80,000 and multi-families selling for $100,000 that are now reselling for less than $40,000. In many areas, especially if the property needs work, they are down around $5000. This is the banks taking a huge soaking. Affordable Housing, sub-prime, and the "no/low money down" era caused something besides forclosures that is really at the root of all this. Inflated property value. Getting people in houses, they can't afford, at a price that does not hold value that when the economy turns "down" causes a fallout in many neighborhoods causing everybody's values to go down.

Now, even high-end houses are not holding value. I've seen some houses that 4 years ago were $400-500,000 are now sitting on the market for over a year at $250,000.

Like I mentioned earlier, when you try to extend the "good" times and put off corrections like this government and federal reserve like to try to do, you get bigger "dips" later.

An over inflated real-estate bubble popped.

Many realtors and brokers are now going to suffer and may fall out of the business.

Jason, there you go trying to explain things with facts. Damn, don't you know that no one in the media is concerned with facts, why should we? Seriously, great information. There are no easy answers to what happened, but the more we get told how bad Real Estate is, the worse it will get.

NOV

2008

just got back from the polling booth. I am wearing my ' I voted Today ' sticker with pride. Only 1 hour , not too bad.

Sub-prime has been the lightening rod of the real estate crisis and credit crisis debacle more so then an industry leader in statistics

Jason.... I take pictures of pretty loan officers and sell a calendar called "Hot Babes of Mortgages" Can I leave my link, www.hotbabesbyjeff.com here? Or my office number, 696-fun-jeff?

Seriously... I agree with Neal and Scott made a good comment about non-prime loans. What category do they throw Alt-A loans into? I will have to check out this site.... besides, I don't like to many of these services, no matter who they are from. Many are misleading, missing data, have wrong data in different groups, and group them differently than others.

So, basically what I am saying is that I don't put to much stock in these stats...Just my .02....

jeff belonger

NOV

2008

Russell - I looked it over, I could of done much better. But, thank you!

Neal - That is more than likely a wise move.

Susan - You are afforded VIP credentials on my posts. It's not because you send me business or hype my name; I just like you.

Dan - I had doubts about any bailouts from the beginning. I hoped I was wrong as they happened. I still hope I am wrong...

Mr. Geary- And to think that the bulk of the loans that were made for our firm for conventional ones? As far as fighting nice, I typically do... I hope;)

Jay - That's more than a pop, that's an explosion! If I buy a property that's worth about half of what it was 3-4 years ago, that's troublesome. Then again, if I plan to live there and it doubles from its initial worth in another two years, that's equally troublesome. Extremes are just that.

Fred - Let's give them the facts and our sales pitch. That seems fair.

James - I wasn't even a Sub-prime guy, it was about 25% of my biz. But there is a place for that entity that I see taken up once again by Finance Companies. Finance Companies have their place, but come on! FHA provides a answer, but not for investors or folks trying to hide income from the government who are self-employed.

Belonger - I don't totally disagree. You are a 'stat' guy and I have human qualities and bleed every once in awhile. Before sleep, comes clarity.

NOV

2008

And I like you, my friend! And, of course, it goes without saying that I love Jennifer! xxoo

Susan - Great, now send me some business;) Jennifer is easy to love... and very difficult to deal with at times. That's only one of the reasons we are a splendid match:)

Leave a response…

Name:

Email:
(optional)

Comment:

What does the graphic say?