Originally posted by: Vic
That's fine. Accepted. It's not a threat though. You crossed a legitimate line. And I do think it was in more than one post, but I won't argue that point. It just needs to stop, and I'll pretend it never happened.
All I have been doing in these threads is encouraging people not to panic, while IMO you have been intent on inciting as much panic as possible. That (intentionally inciting panic) is something BTW which I do consider to be unethical. I have repeatedly told you here (and encouraged even to search my posts for yourself) that during the boom I encouraged people not to be overexhuberent nor to buy more house than they could afford. You have continued to pretend as though I have acted exactly the opposite.
I have no doubt (and have even said as much) that some people in some markets are going to get burned. I have said this repeatedly, even bringing up Slew Foot's market of Sacramento more than once as a prime example. I would appreciate if you would quit pretending that I am saying the opposite, simply because you feel the need to incite panic. No one has been saying that the boom would continue forever. OTOH inciting panic does not help anyone and will only make things worse. As I told you the other day, your plan of "helping" the housing market by not having anyone ever buy a home again is clearly flawed.
Consumer confidence drops in March
By ANNE D'INNOCENZIO, AP Business Writer2 hours, 45 minutes ago
Consumer confidence dropped more than expected in March, sending the widely watched index to its lowest level since November, as shoppers became anxious about a run-up in gasoline prices and stock market turbulence.
The New York-based Conference Board said Tuesday that its Consumer Confidence Index fell to 107.2, down from the revised 111.2 in February. Analysts had expected a reading of 109. The March index was the lowest since November 2006 when the reading was 105.3.
In a statement, Lynn Franco, director of the Conference Board Consumer Research Center, said that despite diminished expectations, consumers' assessment of the economy was steady and the report does not "suggest a weakening in economic conditions."
"The recent turmoil in financial markets coupled with the run-up in gasoline prices may have contributed to consumers' heightened sense of uncertainty and concern. The direction of both components over the next few months bears watching to determine whether this decline is just a bump in the road or something more substantial," Franco said.
Economists closely monitor consumer confidence because consumer spending accounts for two-thirds of all U.S. economic activity.
The Present Situation Index, which measures how shoppers feel now about economic conditions, increased slightly to 137.6 from 137.1 in February. The Expectations Index, which measures consumers' outlook in the next six months, declined to 86.9 from 93.8.
The report was a bit sobering for retailers and other businesses that rely on consumer spending.
The arrival of warmer weather this month ? following an unusually cold January and February ? has helped the nation's retailers catch up to a slow start to the spring selling season. But a slowing economy, particularly a weakening housing market, could challenge shoppers in the months ahead. Rising defaults and delinquencies in subprime mortgages and fewer home equity withdrawals that give consumers extra cash could curtail spending.
The latest report on new home sales, issued Monday, dimmed hopes for a rebound in the housing market. Sales of new homes fell sharply for a second consecutive month in February, the Commerce Department reported. It also said that sales of new single family homes fell by 3.9 percent last month to a seasonably adjusted annual rate of 848,000, the slowest sales pace in nearly seven years.
Meanwhile, there are concerns about rising gasoline prices. The national average price for gasoline climbed for the eighth straight week, according to a government report released Monday.
Concerns about the housing market, the economy and consumer spending have made investors jittery, putting pressure on the stock markets which had surged in the second half of 2006.
Counterbalancing that is the job market, which has been solid.The Labor Department reported earlier this month that the nation's unemployment rate dipped to 4.5 percent even as big losses of construction and factory jobs limited overall payroll growth.
Lennar profit drops 74 percent
By Ilaina Jonas2 hours, 20 minutes ago
Lennar Corp. (NYSE:LEN - news), the No. 3 U.S. home builder, posted a 74 percent plunge in profit on Tuesday and withdrew its earnings forecast, saying the industry's spring selling season has failed to bloom and its outlook for the rest of 2007 does not look bright.
Lennar also said the widening problems in the subprime lending sector have weakened an already anemic market and it did not issue new financial forecasts for the rest of the year, citing market conditions.
"While some markets are performing better than others, the typically stronger spring selling season has not yet materialized," Stuart Miller, Lennar chief executive, said in a statement. "These soft market conditions have been exacerbated by the well-publicized problems in the subprime lending market."
The company's shares fell 2.9 percent to $43.26 in morning trading on the New York Stock Exchange, helping to push down the sector 2.6 percent, according to the Dow Jones U.S. Home Construction Index (^DJUSHB - news).
For the quarter ended February 28, Lennar posted net earnings of $68.6 million, or 43 cents per share, down from $258.1 million, or $1.58 per share, a year earlier.
Analysts on average had forecast earnings of 55 cents per share, according to Reuters Estimates.
The U.S. housing market has been suffering from a steep downturn for more than a year as high prices and climbing interest rates repelled prospective buyers. The industry is grappling with a glut of supply, while home builders have cut prices and shrunk their businesses to wait out the downturn.
Meanwhile rising default rates in the subprime segment of the U.S. mortgage market have jumped in recent months and threaten to prolong the housing downturn. At least 20 lenders in the subprime mortgage sector, which serves borrowers with poor credit histories at high interest rates, have gone out of business as a result.
The crisis has triggered broader concerns that the fallout may spread to mainstream lenders and damage the economy.
Last week, KB Home (NYSE:KBH - news) also said it was concerned about the fall-out from the subprime crisis.
During the quarter, Lennar recorded a gain of about $175.9 million for the sale of a stake in its LandSource, a land and development company, and incurred charges of about $92 million for lower value of the land.
Revenue from home sales fell 10 percent to $2.6 billion, primarily due to a 4 percent decrease in home closings to 8,566, excluding unconsolidated businesses. The West and Central regions accounted for most of the softness.
The average sales price of a home fell 7 percent to $303,000. Greater sales incentives -- about $45,500 per home sold in the first quarter, compared with $13,800 a year earlier -- squeezed gross margins to 15.6 percent down from 24.9 percent in the first quarter 2006.
Total revenue declined 13.8 percent, to $2.79 billion.
New orders during the quarter fell 29 percent, to 6,778 homes, excluding unconsolidated businesses.
"There is so much product available for sale in the resale market, it's very difficult for home builders," JMP Securities analyst Jim Wilson said.
Last month, sales of existing homes rose 3.9 percent, but sales of new homes fell by the same amount, recent government reports showed.
In January, Lennar had forecast full-year earnings of at least $3.69 per share, but on Tuesday said it would likely not meet that forecast.
Analysts forecast full-year earnings of $2.41 per share.
Other homebuilders were also caught in the draft of Lennar's news. Hovnanian Enterprises (NYSE:HOV - news) shares were down 3.7 percent at $26.32; Beazer Homes (NYSE:BZH - news) was down 4 percent, at 31.05; KB Home Inc. (KBH.N) was off 2.8 percent, at 44.69; and Toll Brothers (NYSE:TOL - news) was down 2.4 percent, at 28.15.
Fed sees subprime market woes for one to two years
But 'contagion' hasn't spread to rest of housing, says another bank regulator
By Robert Schroeder, MarketWatch
Last Update: 12:31 PM ET Mar 27, 2007
WASHINGTON (MarketWatch) -- The Federal Reserve is concerned that borrowers of subprime mortgage loans may face "more difficulty" in the next one to two years, a Fed official said Tuesday.
In particular, those borrowers with recently originated adjustable-rate mortgages are likely to experience more delinquencies and foreclosures, said Sandra Braunstein, the director of the Fed's division of consumer and community affairs.
In testimony before a House Financial Services subcommittee, Braunstein also said incentives for responsible subprime lenders need to be preserved so that access to credit can be maintained.
However, facing close questioning by lawmakers, regulators largely dismissed the need for new legislation to combat problems in the subprime market.
"What is there now is appropriate," Braunstein said.
Office of Thrift Supervision Director John Reich said the market "is in the process of correcting itself," but that lawmakers should extend recently issued federal proposals to tighten rules on subprime lending to all lenders, not just federally insured institutions.
Banking regulators demanded tougher standards for subprime loans in proposed guidance earlier this month.
Meanwhile, Reich said "contagion" hasn't yet spread to other sectors of the housing sector from the shake-out in the industry.
"There do not appear to be forces that would result in contagion to other aspects of the housing industry and mortgage lending," he said.
But lawmakers peppered regulators with questions about what went wrong in the market and how to ensure it doesn't happen again.
Rep. Carolyn Maloney, the New York Democrat who chairs the committee's financial institutions and consumer credit subcommittee, said she wished regulators would have acted sooner to correct problems in the market.
Rep. Spencer Bachus, R-Ala., said lawmakers should tighten rules on more mortgage brokers. But he said any new rules should protect access to credit.
"The last thing we need at this point is ill-conceived legislation that dries up credit availability to ordinary Americans while worsening the current market downturn," Bachus said.
Tuesday's hearing is second in less than a week about the subprime market, which has fallen into crisis as several lenders specializing in mortgages to buyers with lower credit scores have gone bust.
Last year, subprime mortgages were a $600 billion business that accounted for about a fifth of all home loans, according to industry publisher Inside Mortgage Finance.
But the sector has spiraled into a crisis as borrowing costs have climbed and the U.S. housing market has cooled.
Another banking official said Tuesday that the regulators' recently issued subprime proposals will have mixed effects.
"To be sure, there needs to be a return to more realistic underwriting standards, and the guidance should have that positive effect," said Emory Rushton, senior deputy comptroller at the Office of the Comptroller of the Currency. "But we cannot ignore the likelihood that tighter underwriting will mean fewer--and smaller--loans," he said.
Braunstein said the Fed is also reviewing whether it can beef up its authority to stop deceptive and unfair lending practices by federally and state-regulated mortgage lenders.
Rushton noted that national banks produced less than 10% of all new subprime mortgages in 2006, but said that national banks should work with troubled borrowers to resolve their problems.
The subprime market's woes have also negatively impacted the stock market.
Stock dipped Tuesday morning as homebuilder Lennar (LEN
Lennar Corporation scrapped its 2007 earnings guidance and warned that the distress in the subprime mortgage market is hurting the company. See Market Snapshot.
Several lenders in the business have gone bankrupt, including Ownit Mortgage Solutions, ResMAE Mortgage and Mortgage Lenders Network USA.
I've seen the 2.4 million number floated around. But of course, some of those people will just move to more affordable homes/mortgages. The 1 million unable to move to a different home and who will leave the housing market is the most interesting number. Of course, it is just an estimate, but it is the first estimate that I've seen that separated the 2.4M number into categories.NEW YORK (CNNMoney.com) -- About 2.4 million holders of subprime mortgage loans made between 1998 and 2006 will lose their properties to foreclosure, according to a report from the Center for Responsible Lending, a non-profit policy and advocacy organization for home owners.
Worse, that will result in a net home ownership loss of one million households.
CRL's analysis rebutted the mortgage industry's claims that the increase in subprime loans has opened up home ownership for millions of low income buyers. Instead, CRL contends, relatively little subprime lending is used for first-time home buying.
Testifying before the House Finance Committee today, CRL's president, Michael Calhoun, said the primary reason for the jump in foreclosures is "the abandonment of underwriting standards."
The report criticized both lax underwriting - noting in particular a disregard for the ability of borrower's ability to repay loans - as well as dangerous loan vehicles, such as "exploding ARMs," which have low rates for the first two or three years before resetting at much higher rates.
CRL contends that few subprime loans went to first time buyers, a notion that was seconded by Emory Rushton, chief national bank examiner for the Office of Comptroller of the Currency, in his testimony before the Finance Committee. He pointed out that Mortgage Bank Association figures revealed only 11 percent of subprime loans went to first-time buyers last year.
CRL says the record going back to 1998 is even worse; only 9 percent of subprime loans went to first-time buyers in the nine years through 2006.
The bulk of these loans actually went to refinance existing mortgages, incurring additional fees. And many of these refinancings involved cash back deals which increased the size of the original mortgages. When all was said and done, borrowers owed more on their homes after refinancing.
Because of the lower teaser rates, however, the new loans were affordable - at first. But when they reset at the higher, fully indexed rates, many borrowers could no longer make their payments.
Often that forced home owners to refinance yet again, extracting even more equity from their house. Since home prices kept rising, there was home value to draw on.
But now that prices are stagnant, even falling in some areas, many owners find themselves tapped out or even underwater, owing more on the mortgage than the house is worth and unable to make their monthly mortgage payment.
Borrowers in this kind of a bind are likely to find themselves in foreclosure, and that's what's going to lead to the decline in home ownership that CRL is predicting.
Originally posted by: dullard
I've seen the 2.4 million number floated around. But of course, some of those people will just move to more affordable homes. The 1 million unable to move to a different home and who will leave the housing market is the most interesting number. Of course, it is just an estimate, but it is the first estimate that I've seen that separated the 2.4M number into categories.
Originally posted by: dullard
Thanks, Trianon for those links. Let me add another link because it is relevant to recent discussions in these housing threads. It also puts estimates on the numbers so people can make decisions for themselves on the subject of subprime mortgages. Link.
I've seen the 2.4 million number floated around. But of course, some of those people will just move to more affordable homes. The 1 million unable to move to a different home and who will leave the housing market is the most interesting number. Of course, it is just an estimate, but it is the first estimate that I've seen that separated the 2.4M number into categories.NEW YORK (CNNMoney.com) -- About 2.4 million holders of subprime mortgage loans made between 1998 and 2006 will lose their properties to foreclosure, according to a report from the Center for Responsible Lending, a non-profit policy and advocacy organization for home owners.
Worse, that will result in a net home ownership loss of one million households.
CRL's analysis rebutted the mortgage industry's claims that the increase in subprime loans has opened up home ownership for millions of low income buyers. Instead, CRL contends, relatively little subprime lending is used for first-time home buying.
Testifying before the House Finance Committee today, CRL's president, Michael Calhoun, said the primary reason for the jump in foreclosures is "the abandonment of underwriting standards."
The report criticized both lax underwriting - noting in particular a disregard for the ability of borrower's ability to repay loans - as well as dangerous loan vehicles, such as "exploding ARMs," which have low rates for the first two or three years before resetting at much higher rates.
CRL contends that few subprime loans went to first time buyers, a notion that was seconded by Emory Rushton, chief national bank examiner for the Office of Comptroller of the Currency, in his testimony before the Finance Committee. He pointed out that Mortgage Bank Association figures revealed only 11 percent of subprime loans went to first-time buyers last year.
CRL says the record going back to 1998 is even worse; only 9 percent of subprime loans went to first-time buyers in the nine years through 2006.
The bulk of these loans actually went to refinance existing mortgages, incurring additional fees. And many of these refinancings involved cash back deals which increased the size of the original mortgages. When all was said and done, borrowers owed more on their homes after refinancing.
Because of the lower teaser rates, however, the new loans were affordable - at first. But when they reset at the higher, fully indexed rates, many borrowers could no longer make their payments.
Often that forced home owners to refinance yet again, extracting even more equity from their house. Since home prices kept rising, there was home value to draw on.
But now that prices are stagnant, even falling in some areas, many owners find themselves tapped out or even underwater, owing more on the mortgage than the house is worth and unable to make their monthly mortgage payment.
Borrowers in this kind of a bind are likely to find themselves in foreclosure, and that's what's going to lead to the decline in home ownership that CRL is predicting.
Originally posted by: Trianon
Originally posted by: dullard
I've seen the 2.4 million number floated around. But of course, some of those people will just move to more affordable homes. The 1 million unable to move to a different home and who will leave the housing market is the most interesting number. Of course, it is just an estimate, but it is the first estimate that I've seen that separated the 2.4M number into categories.
With 300 mln living in the US, I think 1 mln households is a very significant number that will put a dent in overall economy health.
Bernanke: mortgage woes not spreading
By JEANNINE AVERSA, AP Economics Writer 1 hour, 17 minutes ago
WASHINGTON -
Federal Reserve Chairman Ben Bernanke told Congress on Wednesday that growing troubles in the market for risky mortgages thus far doesn't appear to be spreading to the overall economy but the situation bears close watching.
"At this juncture ... the impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained," Bernanke said in testimony to Congress' Joint Economic Committee.
It marked Bernanke's most extensive discussion yet of the mounting problems in the risky mortgage market. Those troubles raise "some additional questions about the housing sector," which has been mired in a deep slump for more than a year, Bernanke said.
Fallout in the risky mortgage market is clobbering some lenders and homeowners and has stoked concerns on Wall Street, Capitol Hill and elsewhere.
So-called "subprime" lenders who make home loans to people with blemished credit histories or low incomes have been battered. Weak home prices and rising interest rates have made it increasingly difficult for borrowers to keep up with their payments. Delinquencies and foreclosures in the subprime mortgage market are soaring.
"Although the turmoil in the subprime mortgage market has created financial problems for many individuals and families, the implications of these developments for the housing market as a whole are less clear," Bernanke said.
The crumbling housing market has been a major factor behind the slowdown in the U.S. economy. Bernanke said the "near-term prospects for the housing market remain uncertain."
Even so, Bernanke stuck with the Federal Reserve's assessment that the economy is likely to grow at a moderate pace over the coming quarters. He also repeated the Fed's belief that inflation also should ease in the months ahead.
To be sure, Bernanke was careful to hedge the Fed's economic bets. The housing slump could turn out to be worse than expected, perhaps exacerbated by problems in the market for risky mortgages, he said. Recent weakness in business investment also could persist, he added. Those forces could further dampen economic growth.
On the other hand, consumers which proved "quite resilient" despite the housing slump and increases in energy prices, could continue to keep spending at a pace that would make the economy grow faster than currently expected, he said. And, there are other forces, including a still-good jobs market that is producing fatter paychecks, that could push up inflation.
The Fed chief's testimony comes amid fresh questions about the country's economic health, given problems with subprime mortgages, stock market turbulence and worries about the severity of the housing slump.
Against this backdrop, Sen. Charles Schumer (news, bio, voting record), D-N.Y., chairman of the Joint Economic Committee, and some other lawmakers said the Fed should be open to cutting interest rates.
"Another reason to be open to an easing of monetary policy is the concern that the housing market adjustment is far from over," Schumer said. "Recent housing data has offered little encouragement that the market might be stabilizing. So it is still too early to tell if the worst is over for the housing market," he added.
There are some fears that consumers ? whose confidence is sagging ? and businesses could clamp down on spending and investing, thus short-circuiting overall economic growth. Rising prices for gasoline and other items also are raising concerns about inflation. These economic crosscurrents can complicate the Fed's job of trying to keep the economy and inflation on an even keel.
Just hours before Bernanke testified, the government reported that new orders for costly manufactured goods staged a modest rebound in February after a sharp slide the month before that jarred investors.
Last week Bernanke and his Fed colleagues decided to once again hold a key interest rate steady at 5.25 percent, which hasn't budged since August. They also gave themselves more leeway about future rate moves, raising the possibility that rates could go down. Previous policy statements had spoken only of the possibility of rate increases. The direction of rates, the Fed said, hinges on what incoming barometers say about the economy and inflation. Bernanke repeated that point on Wednesday.
Wall Street investors and some economists believe the Fed could start to cut rates this year to guard against any undue economic weakness. Other economists, however, believe rates probably will stay where they are throughout this year.
The boom/bust mentality is 100% at fault.Originally posted by: Slew Foot
Just a couple anecdotal things I heard on the radio or at work today:
A mortgage lender was on the radio talking about loans and saying that unless you had a credit score of 720 or higher, you couldnt get a no-down loan in CA, looks like the lenders are tired of loaning to people without skin in the game.
At work, people were talking about how bad the RE market was and how many people were going into foreclosure. Someone mention that prices were down around 40% (which even to me sounds high for now anyway). Kinda amazing that in 2 years, the talk of RE in Sacramento went from a sure fire get rick quick investment, to an anchor that can drag you down for many years. This mentality, along with a glut of supply, is what will force prices down.
Originally posted by: Vic
The boom/bust mentality is 100% at fault.Originally posted by: Slew Foot
Just a couple anecdotal things I heard on the radio or at work today:
A mortgage lender was on the radio talking about loans and saying that unless you had a credit score of 720 or higher, you couldnt get a no-down loan in CA, looks like the lenders are tired of loaning to people without skin in the game.
At work, people were talking about how bad the RE market was and how many people were going into foreclosure. Someone mention that prices were down around 40% (which even to me sounds high for now anyway). Kinda amazing that in 2 years, the talk of RE in Sacramento went from a sure fire get rick quick investment, to an anchor that can drag you down for many years. This mentality, along with a glut of supply, is what will force prices down.
Originally posted by: LegendKiller
Originally posted by: Vic
The boom/bust mentality is 100% at fault.Originally posted by: Slew Foot
Just a couple anecdotal things I heard on the radio or at work today:
A mortgage lender was on the radio talking about loans and saying that unless you had a credit score of 720 or higher, you couldnt get a no-down loan in CA, looks like the lenders are tired of loaning to people without skin in the game.
At work, people were talking about how bad the RE market was and how many people were going into foreclosure. Someone mention that prices were down around 40% (which even to me sounds high for now anyway). Kinda amazing that in 2 years, the talk of RE in Sacramento went from a sure fire get rick quick investment, to an anchor that can drag you down for many years. This mentality, along with a glut of supply, is what will force prices down.
I would really like to know your reasoning behind this. I am being completely sincere and serious
Originally posted by: dmcowen674
3-29-2007 Mortgage crisis hits million-dollar homes
In the last three months, the percentage of foreclosures for U.S. homes valued at more than $750,000 has climbed to 2.5 percent
Josh Rosner, managing director at investment research firm Graham Fisher & Co., says the growing numbers of foreclosures outside the subprime market is just the start.
"It's not the American Dream anymore," said Fran Napolitano, a county clerk in Hackensack. "It's 'who can I stab next."'
Originally posted by: senseamp
I would not touch any of the houses in my area unless they drop at least 30%.
Originally posted by: dmcowen674
Originally posted by: senseamp
I would not touch any of the houses in my area unless they drop at least 30%.
I've noticed prices plunging at least in half here. People that were trying to get $400,000 for their houses just 3 months ago now have them listed at $200,000.
Credit Suisse sues three subprime lenders
1 hour, 43 minutes ago
A Credit Suisse Group (CSGN.VX) unit is charging three subprime mortgage lenders with violating loan obligations and has filed lawsuits totaling over $30 million.
DLJ Mortgage Capital Inc., a Credit Suisse unit that purchases mortgage loans from lenders, alleges in separate suits that Sunset Direct Lending LLC and Infinity Home Mortgage Co. Inc. breached agreements to repurchase loans they originated.
DLJ is seeking nearly $24 million in buybacks from Sunset and $3 million from Infinity.
The suits allege that the lenders violated agreements to repurchase loans in the event of payment defaults. The suits cite clauses that require repurchases if borrowers are delinquent for 30 days within the first three months of the loan sale.
DLJ also filed suit against Netbank Inc. (Nasdaq:NTBK - news), alleging failure to provide both funds and information relating to purchased loans. The suit seeks $4 million in damages.
The three suits, filed in the U.S. Southern District Court in New York, likely represent a new chapter in the subprime mortgage crisis, where underperforming loans have threatened both lenders and the Wall Street firms that purchased them.
The Financial Times reported on Friday that a unit of Bear Stearns Cos. (NYSE:BSC - news) has filed a $70 million suit against a lender. A spokesman for Bear Stearns declined to immediately comment.
Originally posted by: Trianon
Originally posted by: dmcowen674
Originally posted by: senseamp
I would not touch any of the houses in my area unless they drop at least 30%.
I've noticed prices plunging at least in half here. People that were trying to get $400,000 for their houses just 3 months ago now have them listed at $200,000.
got any jobz there? 200K sound like a good price for single family in good condition
.Originally posted by: dmcowen674
Originally posted by: Trianon
got any jobz there? 200K sound like a good price for single family in good condition
Mostly boat mechanics, Marina workers, service sector etc, it's a resort town.
Originally posted by: Trianon
more subprime related lawsuits REUTERS
Credit Suisse sues three subprime lenders
1 hour, 43 minutes ago
A Credit Suisse Group (CSGN.VX) unit is charging three subprime mortgage lenders with violating loan obligations and has filed lawsuits totaling over $30 million.
DLJ Mortgage Capital Inc., a Credit Suisse unit that purchases mortgage loans from lenders, alleges in separate suits that Sunset Direct Lending LLC and Infinity Home Mortgage Co. Inc. breached agreements to repurchase loans they originated.
DLJ is seeking nearly $24 million in buybacks from Sunset and $3 million from Infinity.
The suits allege that the lenders violated agreements to repurchase loans in the event of payment defaults. The suits cite clauses that require repurchases if borrowers are delinquent for 30 days within the first three months of the loan sale.
DLJ also filed suit against Netbank Inc. (Nasdaq:NTBK - news), alleging failure to provide both funds and information relating to purchased loans. The suit seeks $4 million in damages.
The three suits, filed in the U.S. Southern District Court in New York, likely represent a new chapter in the subprime mortgage crisis, where underperforming loans have threatened both lenders and the Wall Street firms that purchased them.
The Financial Times reported on Friday that a unit of Bear Stearns Cos. (NYSE:BSC - news) has filed a $70 million suit against a lender. A spokesman for Bear Stearns declined to immediately comment.