Dominic Darmanin

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BIG Trouble for Canada's Largest Subprime Mortgage Lender

BIG Trouble for Canada's Largest Subprime Mortgage Lender

As with most news releases it's hard to know exactly what the truth is. In this case Home Capital Group's stock plummeted 61% after reports that its top former executives failed to satisfy disclosure requirements, made “materially misleading statements” and failed to comply with other securities rules.
(reported by Bloomberg, April 20, 2017). Home Capital Group is the largest lender of subprime mortgages. These are mortgages that are offered at above prime to those who do not qualify for prime rate mortgages due to low credit ratings or other factors which increases the probability of them defaulting on their mortgages.

According to another article, their take was that the “Canada's housing bubble popping amid the collapse of the country's largest mortgage lender.” The article then goes onto discuss the bailout of CDN$2 billion from the retired health workers in Ontario to prevent the Home Capital Group from going bust (reported by ZeroHedge April 27, 2017). In fact Home Capital Group isn't going under because they have been bailed out. I wish the author would make up his mind for cryin' out loud!

Two very different takes on the same news with vastly divergent connotations. Hard to know what to believe these days. However, pictures or graphs speak a thousand words. So you be the judge of what the future of the Canadian real estate market is because, quite honestly, no one really knows.
#BIG#Trouble#canada#Largest#Subprime#Mortgage#Lender#canada#BadNewsBears#downhill#vancouver#surreybc#toronto#badcustomerservice
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