IndyMac: Subprime delinquencies are 18-20%

Another quirky data collection error from the Mortgage Bankers Association.  They group loans by the type of servicer, instead of by the type of loan.  They end up understating the delinquencies in subprime, and overstating the delinquencies in prime.  Put another way, instead of counting the number of delinquent subprime loans, they count the number of delinquent loans from a company classified as subprime.  

Matthew Padilla at the OC Register caught this snippet from IndyMac's CEO Michael Perry, explaining that IndyMac and Countrywide are considered prime lenders by the MBA, so any defaults from their loans go into the "prime default" category.  Very strange way of reporting numbers, and highly suspect that this was not explained before.   This goes to show, we cannot ever go by the headlines.  Always ask what is measured, and how.