As expected Banks are tightening their lending standards.  Its ironic because those that suffer are not impacted by the sub-prime matter.  Their personal circumstances have not changed one iota.  This change is purely a reflection of tighter money markets, which drives up Banks capital costs, and then the risk assessment and pricing groups re-calibrating their yields.

Loan standards tighten | csmonitor.com

Since the beginning of the month, lenders have tightened their standards. They are now very reluctant to make high-risk loans to individuals with spotty credit records. They’re also requiring higher down payments, meaning that home buyers need to have much more money saved up. In addition, some Americans – including the self-employed, consultants who work from home, and those with unconventional sources of income – may be denied home loans.

Prosper do not have that dynamic …. something to watch.

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