April 17, 2007
Many borrowers who had hoped to refinance loans after two or three years of low teaser rates will now be unable to do so, making sub-prime servicing businesses valuable for their collection expertise, but reducing the value of loan-origination operations.
Buyers are skeptical about those businesses because "origination of something that's disappearing is a magic trick that no one has quite figured out," said Stan Ross, chairman of the Lusk Center for Real Estate at USC.