Scratch and Dent Mortgage Loans:
The Scratch and Dent Mortgage industry does have similarities to stocks and bonds in the sense there is a right time to sell and a right time to hold. Mortgage providers have many things to consider when the time comes to make a decision on a Scratch and Dent Loan. Such as cash flow requirements, Profit and Loss Statements, interest rates and Scratch and Dent Mortgage prices.
Industry:
The cash flow and P&L topics are always going to be case by case and company by company. However, the interest rate situation and current Scratch and Dent Mortgage pricing is consistent across all mortgage providers. Whether a mortgage company is trying to sell a…
- Scratch and Dent Loan
- Investor Fall-out Loan
- Non-QM Loan
- Jumbo Loan
- Re-performing Loan
- Sub-performing Loan
- Non-performing Loan
- Unsaleable Loan
…the economic factors are all showing signs of a sellers’ market.
Interest rates have been at all-time historic lows for over a decade. However, over the last year rates have steadily climbed and all signs point to more increases over time. Scratch and Dent Mortgage pricing is affected with rising rates as prices will go down for old coupons. Therefore, mortgage providers will continue to see lower bids for aged loans. With this in mind, Mortgage Companies should be looking to liquidate any aged notes they have on their books due to some type of flaw that resulted in the unsaleable loan.
Another reason to support the right environment to sell Scratch and Dent Mortgage Loans, is the Bid vs. Ask as never been so beneficial to the seller. There has been an increase in buyers in the Scratch and Dent industry over the last five years. This increase in buyers has created competition amongst them that has driven pricing higher which directly benefits the seller. Mortgage Providers are now realizing very favorable pricing as compared to recent years.
Summary:
Therefore considering interest rates and current pricing, Mortgage Providers can benefit from liquidating all unsaleable loans under current market conditions. Right House Capital is prepared to assist any mortgage provider that wishes to take advantage of these economic factors that are benefiting the seller in the Scratch and Dent industry.
For more information or if you have any problem loans you want to liquidate today, contact Andrew Zale at 502-365-5632.
