by Calculated Risk on 2/10/2007 12:33:00 PM

Fleckenstein on Jan 30, 2007:

Turning to the subprime industry, once again I heard from my friend ... He continues to feel that things are about to really get worse. In an email to me, he wrote: "Scratch and dent loans are killing everybody. ... NO ONE is making any money in the market right now. We are at a point of no return for many. The next two weeks will be wild."

... Remember, we are just now witnessing a change in lending standards, and these will ripple all through the lending food chain, though thus far only small changes have occurred.
emphasis added

Wild indeed.

For a discussion on mortgage terms, see Tanta on "Scratch and Dent" Loans