Subprime Lenders Lose More Money to Caution Than They Ever Lose to Default
They just never see it on a spreadsheet. Quick answer:Most subprime lenders do not get crushed by default. They get crushed by caution. When your “book” is undercapitalized, you start making cash decisions that look like risk decisions. You tighten, you stall, and the biggest loss never hits the P&L. It walks out the door […]