Angel Reyes Blog : Angel Reyes : Texas Litigation Lawyer and Attorney : Dangerous Drugs : Wrongful Death : Business Litigation

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For months now I've been following the story of the troubled subprime mortgage loan markets.  I am not really old enough to remember the Savings and Loan scandals which led to the collapse of the Savings and Loan institutions that had mushroomed across the United States in the 70's and 80's.  After all, I was busy drinking and chasing girls through college at the University of Kansas and the University of Michigan Law School.  However, I am enough of a student and reader to vaguely recall that there were some really loose lending criteria, some eager to please appraisers, and the usual cast of greedy developers and businessmen to cause quite a banking scandal during those years. At the risk of mixing metaphors, does anyone else get the sense that the music has stopped in the subprime mortgage markets?  Exhibit #1, New Century Financial announced that the Feds  have informed the company that a criminal inquiry, yes criminal, into its accounting and trading in its securities has been launched.  Say goodbye to New Century, they are toast.  Exhibit #2, Fremont General announced it would no longer sell subprime residential loans and is seeking to sell that part of its business.  The buyer should expect to price any acquistion of Fremont with healthy litigation numbers.

The good news is that in 10 years, there will be a newer, more creative way to finance the American dream.  Wall Street will always find a way to put people in loans.  So don't fret, if you missed the borrowing boat this time, you'll get another shot soon enough.  Your credit won't matter after the quant guys figure out a way around the regulation that is sure to come now that the music has stopped in the subprime mortgage markets.

©2007 Angel Reyes
www.ReyesLaw.com