Sub-Prime Lending Expansion

[Mother Bond]

Has the growing sub-prime lending market led to the increase in mortage broker bond rates?

[Bond Guy]

Yes. The sub prime market has contributed greatly to the increased risk associated with Mortgage Broker Bonds. The Industry as a whole has had some hard times thus making some Surety Companies very leary when it comes to underwriting companies that sell sub-prime loans. A few Surety Companies we underwite with will not write any business at all if they handle sub-prime loans.