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You realtors on this board, Mike, Vicki, Leighbhe, and others whose names I can't think of right now, you all seem very knowledgeable. I know Raleigh is maintaining a healthy housing market, but what is it like for buyers right now? Are people having a significantly harder time getting loans? I don't mean a few extra hoops to jump through. I mean are people getting turned down who would not have been turned down a year ago? The media make the whole thing sound very intimidating- even with a good credit situation. Anyway, I was just intersted in your viewpoint. Thanks.
Last edited by kmflan; 08-23-2007 at 10:00 AM..
Reason: typo
You realtors on this board, Mike, Vicki, Leighbhe, and others whose names I can't think of right now, you all seem very knowledgeable. I know Raleigh is maintaining a healthy housing market, but what is it like for buyers right now? Are people having a significantly harder time getting loans? I don't mean a few extra hoops to jump through. I mean are people getting turned down who would not have been turned down a year ago? The media make the whole thing sound very intimidating- even with a good credit situation. Anyway, I was just intersted in your viewpoint. Thanks.
I think the media can only sell bad news...
That said, I think the situation is in constant flux. The faith in the US economic system is being tested. I am optimistic that it will pass the test.
I am also afraid that that means we will be into irresponsible lending again in another few years.
Nothing beats an 800 credit score, cash in the bank, and low debt that has been responsibly managed.
I suggest one focus a mortgage search on brick and mortgage lenders; banks, credit unions, s & l's.
Forget online loan brokers.
Forget Lending Tree, which is somewhat of a scandal anyway.
It is harder and harder for them to sell the loans, and that is the liquidity crisis in a nutshell. Why get tied up with someone who shops your loan with no buyers?
JUMBO's may be tough for a while, but I think there will always be a market for what is generally a safe investment of capital.
A very real problem is that programs are changing literally minute-by-minute. If you have a solid lender make a decent offer, it is probbably time to lock. If the costs are decent, you may want to bite the bullet, and not lose a home by shopping rates too.
Another fact: They ain't making any more dirt. Over time real estate is great. If you think you are a short timer in your new home, buy in a great location so your investment is liquid.
I've always believed that the housing market will always survive. Gov't. can't have folks jumping out their windows and owning a home is still considered "The American Dream".
I have recently had one client not able to buy a home right now. However, she does have some credit issues and just not very much credit, in general. One of my lenders is working with her to help her build up her credit score. Due to all the foreclosures, it will be harder for those with low credit scores and no cash to buy a house now. It seems that mortgage lenders have gotten very lenient in the last few years so it may be just time to tighten up. Will the restricitions ease up? Time will tell.
There are still "first time homebuyer" loans with 100% financing, as long as you have good credit and a good job.
People with good credit will always be able to get a mortgage loan. Its those that have some "issues" that are going to miss out, for right now.
I just recently had buyers with great credit scores able to get 100% financing on a home that was about $230,000. However, the mortgage lender DID require a bit more paperwork than they may have required a few months ago.
Seems like we are going backwards in time. More restrictions on mortgage loans, less 100% financing, more paperwork.
I would echo what Mike and Vicki said, some people are having trouble getting loans, but maybe that will help them out in the long run? Meaning, give yourself time to get the credit scores in check, to save some money, etc. People were receiving loans (100 percent loans) at high interest rates and often times lending companies said , you can refi and all will be well. In the end they could not, so they ended up with payments they could never afford.
It is completely unfortunate for many people who, in MY opinion, were duped a little by the mortgage industry. I know, buyer beware, but this is a situation that has ruined some people's credit, etc. That is why I said it might be better that the "strings are tightening" and making it more difficult to get a loan.
Not good news for people like me who had perfect credit until 4-5 years ago. Now we don't anymore. We sold our house to get out from under the debt and didn't have much left over from the equity after the 1st/2nds were paid off. Plus we had some other debt we wanted to clear too.
We're both working and together making over $125K (we'd make more if I weren't so underemployed but the job I took at the time fit my other lifestyle needs. Now, however, if we're not going to be able to make the move to NC right away, I need to find a job in my line of work where I can make double what I'm making now--that will help).
We're renting now. We'd like to buy again in a year or so but not sure we'll be able to do so. I guess it depends on what's happening with the mortgage industry. We're spending the time trying to eliminate our leftover debt and boost our credit score. Hopefully, we'll have made a dent by the time we want to house hunt again--NC or MA.
We have 3 vehicles all of which we own outright, so that's one big step in the right direction!
To NChomesomeday...It sounds as if you are currently carrying little debt. And if you haven't been late on your payments, you would probably still be eligible for 100% financing through some A-paper, Fannie Mae programs. You have the income and if you have liquid assets in the form of 401k's, IRAs, etc, you may rather easily qualify for a My Community or Flex 100 loan.
But what about crappy credit issues we developed in the last 5 years? Someone else mentioned FHA loans too. Regardless of whether we pull off this move to NC or not, we don't want to renew our lease here in MA next June, so that would mean buying again in MA (smaller house!) or renting when we get down to NC for about a year and then buying there.
But what about crappy credit issues we developed in the last 5 years? Someone else mentioned FHA loans too. Regardless of whether we pull off this move to NC or not, we don't want to renew our lease here in MA next June, so that would mean buying again in MA (smaller house!) or renting when we get down to NC for about a year and then buying there.
You need to look for a mortgage banker in NC, probably closer to your lease termination date.
It is an odd climate currently, with enough bad news, and good news too.
The mortgage banker can help steer you through to what you can accomplish, but currently loan programs are shifting around as lending guidelines change rapidly.
Don't assume "No." Make someone you trust tell you "No."
You might just get a pleasant "Yes" surprise.
Governor Easley is moving in the right direction. It may be too late to help those already in foreclosure, but this help control predatory lending. I like these subprime mortgage lenders to older folks being swindled out of their money. As Easley points, out some folks just don't understand finance and are easily duped.
Gov. Michael F. Easley of North Carolina signed legislation last week that would limit the ability of mortgage brokers to charge customers above-market rates and prepayment penalties and would protect subprime borrowers from highly risky adjustable-rate mortgages.
Calling the mortgage meltdown a “wake-up call,” Mr. Easley said, “If Washington isn’t going to act, the states are.”
But amid his call for action was regret that if only officials in his and other states had acted a couple of years sooner, some of the mortgage problems that have roiled the financial markets and hurt homeowners might have been avoided.
“I should have watched this closer; all of us should have on the state level,” he said in an interview after the signing ceremony in Raleigh. “We should have looked at our laws closer and made some changes.”
North Carolina is one of about a dozen states that are beginning to make legislative and regulatory changes to protect people who resort to subprime financing. But economists and housing specialists say the actions come too late to benefit most of those at risk of losing their houses.
With foreclosures expected to rise as adjustable-rate mortgages are reset and the borrowers face higher monthly payments, economists said the steps that states like North Carolina were taking would do more to protect future borrowers than help people already in trouble.
...
In North Carolina, the number of foreclosure filings increased 6 percent in 2006 from 2005 and that is expected to climb to 10 percent this year, said Christopher Kukla, director of state legislative affairs at the Center for Responsible Lending in Durham. “We think the worst of it is still yet to come,” Mr. Kukla said, “because there are still thousands of adjustable-rate loans out there that still will reset in the next six months to a year.”
...
“You know that people are not as financially literate as they ought to be,” Governor Easley said as he signed the new law.
Governor Easley is moving in the right direction. It may be too late to help those already in foreclosure, but this help control predatory lending. I like these subprime mortgage lenders to older folks being swindled out of their money. As Easley points, out some folks just don't understand finance and are easily duped.
Gov. Michael F. Easley of North Carolina signed legislation last week that would limit the ability of mortgage brokers to charge customers above-market rates and prepayment penalties and would protect subprime borrowers from highly risky adjustable-rate mortgages.
Calling the mortgage meltdown a “wake-up call,” Mr. Easley said, “If Washington isn’t going to act, the states are.”
But amid his call for action was regret that if only officials in his and other states had acted a couple of years sooner, some of the mortgage problems that have roiled the financial markets and hurt homeowners might have been avoided.
“I should have watched this closer; all of us should have on the state level,” he said in an interview after the signing ceremony in Raleigh. “We should have looked at our laws closer and made some changes.”
North Carolina is one of about a dozen states that are beginning to make legislative and regulatory changes to protect people who resort to subprime financing. But economists and housing specialists say the actions come too late to benefit most of those at risk of losing their houses.
With foreclosures expected to rise as adjustable-rate mortgages are reset and the borrowers face higher monthly payments, economists said the steps that states like North Carolina were taking would do more to protect future borrowers than help people already in trouble.
...
In North Carolina, the number of foreclosure filings increased 6 percent in 2006 from 2005 and that is expected to climb to 10 percent this year, said Christopher Kukla, director of state legislative affairs at the Center for Responsible Lending in Durham. “We think the worst of it is still yet to come,” Mr. Kukla said, “because there are still thousands of adjustable-rate loans out there that still will reset in the next six months to a year.”
...
“You know that people are not as financially literate as they ought to be,” Governor Easley said as he signed the new law.
And many people in government are not mortgage savvy enough to be enacting knee jerk legislation. Subprime borrowers HAVE to be charged above market rates or NO LOAN FOR THEM. The more risk...the higher the rate has to be. I am not a proponent of subprime, but it does have it's place. The qualifying regulations just got WAY TO LAX!! They would give a loan to anyone. People who don't pay their bills are not cut out to be homeonwer's and I am not talking about people who incur some kind of event (death, job loss, divorce etc.)
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