U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Economics
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old Yesterday, 07:39 PM
 
Location: Southern Most New Jersey
1,169 posts, read 848,578 times
Reputation: 1920

Advertisements

risky mortgages are the least of my worries..
Reply With Quote Quick reply to this message

 
Old Yesterday, 08:46 PM
Status: "Goodbye Portland, Hello Las Vegas!" (set 4 days ago)
 
Location: Henderson, NV
5,881 posts, read 6,067,917 times
Reputation: 6777
Not buying that whatsoever. I just went through getting a mortgage and couldn’t do anything with the builder’s lender despite assets equal to 15x the value of the house. Even my own lender asked a million questions despite me having 4x the loan amount IN their bank!
Reply With Quote Quick reply to this message
 
Old Yesterday, 09:03 PM
 
64 posts, read 11,188 times
Reputation: 86
This thread is so fake...No offense but you aren’t kidding anyone. Lender requirements are as strict as ever, if your not qualified you aren’t getting a mortgage loan it’s that simple.
Reply With Quote Quick reply to this message
 
Old Yesterday, 09:03 PM
 
18,991 posts, read 13,819,005 times
Reputation: 14471
Quote:
Originally Posted by JonathanLB View Post
Not buying that whatsoever. I just went through getting a mortgage and couldn’t do anything with the builder’s lender despite assets equal to 15x the value of the house. Even my own lender asked a million questions despite me having 4x the loan amount IN their bank!
Most lenders are looking for income not assets
Reply With Quote Quick reply to this message
 
Old Yesterday, 09:22 PM
 
842 posts, read 216,663 times
Reputation: 1274
Quote:
Originally Posted by Serious Conversation View Post
Here's a scenario that I think gets overlooked.

I'm closing on a property in about three weeks. All in, my PITI with MI and taxes and insurance in escrow is $659/month. This is for a ~1200 sq. ft, 2BR/2BA townhome with a 544 sq. ft. garage. I'm paying $98,500 for it. 30 year conventional loan. The townhome has brand new appliances (basic builder grade stuff, but it's fine for me), new granite countertops, new laminate flooring and carpet. Other than doing a few minor things to taste, nothing needs to be done.

Between inspections, earnest money, insurance, 5% down, and my part of closing costs, I will be out at least $9,000, probably pushing closer to $10,000-$11,000 after all is said and done. I have an above average income by local standards, but I'm single and that's a fairly big chunk of change to come up with. My credit score with all three bureaus is above 780.

On a purely technical level, my mortgage is probably somewhat risky because it's below 20% down, but I can cashflow the mortgage payment without an issue. One of the biggest barriers to homeownership, especially for younger people, singles, or those in high cost areas, are the initial startup costs to merely get into the home. That's not accounting for any "bumps in the road."

By contrast, locally, I can get into a rental townhome similar to what I have for one month's deposit. Renting has much lower startup costs. That's going to be about $1,000. The rent will be about $1,000/month, and will likely rise annually. On most months, the rent will far exceed my mortgage payment plus repairs. Apart from a relatively small increase in my mortgage insurance or property taxes (this is a low tax area of a low tax state), my mortgage payment is mostly locked in.
I was in a similar situation and obtained an FHA loan. That lowered my startup cost significantly.
Reply With Quote Quick reply to this message
 
Old Today, 05:34 AM
 
916 posts, read 669,191 times
Reputation: 920
Quote:
Originally Posted by JonathanLB View Post
Not buying that whatsoever. I just went through getting a mortgage and couldn’t do anything with the builder’s lender despite assets equal to 15x the value of the house. Even my own lender asked a million questions despite me having 4x the loan amount IN their bank!
Interesting - asset depletion is a way to create income out of liquidity- Freddie Mac just relaxed their requirements
Reply With Quote Quick reply to this message
 
Old Today, 11:11 AM
 
2,541 posts, read 657,086 times
Reputation: 4417
Quote:
Originally Posted by JonathanLB View Post
Not buying that whatsoever. I just went through getting a mortgage and couldn’t do anything with the builder’s lender despite assets equal to 15x the value of the house. Even my own lender asked a million questions despite me having 4x the loan amount IN their bank!
A couple years ago I looked into a bridge loan between buying vacation home "B" and selling vacation home "A," even though I owned home "A" outright and would own home "B" outright. The amount of paperwork they wanted was immense. I thought they would ultimately ask for a DNA sample. It turns out I didn't even need the bridge loan: Home "A" sold right away & closed in 30 days, long before home "B" closed.

I had 70x the assets of the bridge amount in liquid equities, mutual funds, ETFs, muni bonds, & US Treasuries. SMH.
Reply With Quote Quick reply to this message
 
Old Today, 11:17 AM
 
Location: Silicon Valley
3,682 posts, read 1,677,078 times
Reputation: 6305
I think we're seeing more loan action for people with less than 20% down in this area. From one perspective, with pricing now at $1M+ for most homes, asking a new entrant to for $200K does seem....difficult. On the other hand....paying that mortgage is a crazy risk as well. You're basically looking at a power couple that has a lot of stability if they're earning the money from labor.

I can get a no doc loan. One bank offered it to me. I need 50% down though. Problem for me is that my consulting wages aren't permanent, I have no huge POs spanning into the future. My wife's store has nothing permanent....albeit after nearly 2 decades in place one might start to think there's staying value. Rental income takes a haircut. Investments aren't going to be moving from where they are....

So I guess I'm broke in terms of a loan department. Somehow maintaining perfect credit with several mortgages, plenty of collateral and downpayment and a long deposit history that's pretty stable....but who knows. I'm sure my next loan for property will be alternative because of that.

So long as it's the minority of loans, I don't think the emergence is something terrible. However, in 2006 when a friend of a friend I met at a party first introduced himself and said that he had a way of getting me a good loan with no fees that was alt....and I later saw a mountain of fees that he explained the seller was going to pay for....even as it stated that these were simply being paid for by the loan itself, was my firsthand clue as to how bad it had gotten. These slick jerks made really bad alt loans appear to be the only thing on the offering. Another friend who flipped several properties noted at the time how hard it got to get comparable loans and how fees just went through the roof.

That's where the danger comes into play. Having an alternative for circumstances isn't bad. By itself, that won't move the market. We're nowhere close to where we were.
Reply With Quote Quick reply to this message
 
Old Today, 11:20 AM
 
Location: Silicon Valley
3,682 posts, read 1,677,078 times
Reputation: 6305
Quote:
Originally Posted by RationalExpectations View Post
A couple years ago I looked into a bridge loan between buying vacation home "B" and selling vacation home "A," even though I owned home "A" outright and would own home "B" outright. The amount of paperwork they wanted was immense. I thought they would ultimately ask for a DNA sample. It turns out I didn't even need the bridge loan: Home "A" sold right away & closed in 30 days, long before home "B" closed.

I had 70x the assets of the bridge amount in liquid equities, mutual funds, ETFs, muni bonds, & US Treasuries. SMH.
I'm hoping to move assets out of NorCal and diversify a bit. My concern is that if I don't get the sale and buy in 45 days, I blow SS1031 ability to defer gain and transfer basis.
Reply With Quote Quick reply to this message
 
Old Today, 05:18 PM
 
1,259 posts, read 923,002 times
Reputation: 2607
I just noticed the other day that signs have started popping up around the local area offering mortgages to people who can’t qualify for them with a bank. I’m not surprised. I presume that when you call a guy who puts a hand written sign on the side of the road offering a mortgage, it’s not quite the same as going to your bank for one.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics
Similar Threads
Follow City-Data.com founder on our Forum or

All times are GMT -6.

© 2005-2019, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top