Lenders who are in the middle of the subprime housing crisis are folding rapidly and Fremont may be the next one to crumble. The company announced that they have received more default notices on their poor credit mortgages. The California company has issued concerns that they will be unable to maintain their net worth in the midst of this crisis. Fremont stated that “because of ‘limited available liquidity,’ it can neither deposit cash into a reserve account, nor provide a letter of credit to satisfy a tangible net worth covenant associated with guarantees it provided in the loan sale. It said it is in talks for a waiver.”The company also noted that, “To the extent that litigation is pursued and the company was not successful in defending any such lawsuit, its ability to continue to conduct business as a going concern would be called into question.” If you have a poor credit mortgage and are concerned that your lending company may be going under, the time to refinance is now, according to experts. They are urging homeowners to take quick action since the process of refinancing a poor credit mortgage can take up to three months.
Related reading: Poor Credit Mortgage
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