NovaStar Financial Share Prices Rocked By Earnings Report
News of a 14 million dollar loss rocked the price of NovaStar Financials stock yesterday. The market recognized the exposure to sub prime loans that are in a delinquent status or in foreclosure. The number of these loans is expected to rise in the near term as housing prices have remained stable and the ARMs are resetting at a higher rate.
Shares of NovaStar Financial, which makes loans to people with weak credit, fell almost 43 percent yesterday after the company announced a surprise loss of $14.4 million for the fourth quarter and told investors that it might not make enough money to pay dividends for the next four years.
The announcement, which highlighted the fact that more home loans made last year were delinquent than mortgages from 2005 and earlier, echoed reports issued earlier this month by New Century Financial and HSBC Finance, the American mortgage division of the global banking giant.
Though each lender is suffering from a variety of individual ills, rising default rates among loans made to people with spotty, or subprime, credit appear to be the central problem for the industry.
A major indicator of the trouble in the subprime market is the early-payment default rate, which measures the portion of borrowers who fall behind on their house payments within the first few months of taking a loan. via the New York Times
I like your analogy in this article. The real estate economy really is like a patient who you cannot ...
Real Estate is hyper-local. Every market is different. Phoenix has already hit bottom and is starting to recover. We have ...
Great to hear that the big boys
are predicting recovery sooner than
most think.
Thanks for the value! 
I agree--good analogy. You have to crawl before you can walk. Right now, at least in Austin, many people would ...
I live in the Philippines and I am glad we are not on the lists... 
I have a few Litograghs of Presidents homes , made by Richard V. Sebring. yr. 1990 Do they have any ...
I see the question I have, but no response. I do not have a for sale sign up ...
I'll add mine to the list too. This is happening in Kansas City, Missouri as well now.
We already knew ...
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Comment by Wesley on 24 February 2007:
Subprime lenders are falling like flies.
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