One of the shooting stars in the super-hot field of lending to the credit-impaired took several hits this week, leading bearish observers to speculate that the home equity industry may soon fade.

Cityscape Financial Corp., Elmsford, N.Y., declared its first-ever earnings decline on Monday, due to a $15 million charge related in part to the expectation of smaller profits in its U.K. operations. The company was also downgraded by Moody's Investor Services because of a growing number of seriously delinquent loans.

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