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Old 09-09-2013, 10:14 AM
 
19,346 posts, read 17,046,990 times
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Loan Size to Be Cut for Fannie, Freddie - One News Page VIDEO
a move that is likely to face resistance from some lawmakers and the real estate industry. Nick Timiraos reports. Photo: AP.

Look like some people think what ever can be loaned against it.


I say all loans should be "jumbo loans"...

What say you?
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Old 09-09-2013, 12:51 PM
 
Location: Living on the Coast in Oxnard CA
16,276 posts, read 28,898,093 times
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Isn't real estate local? Here in my area $350,000 can buy a 3 bedroom 2 bath home that was built in the 60's. In Surprise Arizona where my parents now live you could buy a home built within the past 10 years for half that price.

What is a home worth? Is it worth the comps that the area offers? Back in 2006 - 2008 we could not afford any homes in our city. A cheap home sold for $550,000. Our street was in the $700,000 range. Still people were buying homes. We bought in 2010 for $310,000 and I would have loved to have bought for under $300K. Still it worked out and we were able to do it. I am so happy that we did. For us that is the price point of what a home should be worth. Our neighbors may not agree. Most of them have owned their homes for years. Two of the neighbors bought the homes new and paid less than $20,000 for them.

Some of us have a plan to pay off the homes we live in. That is our goal. I don't plan on waiting for the full 30 years to end. We want it paid off in another 12 years. At that time I won't care how much is it worth as we have no plans to sell when it is paid off. LOL
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Old 09-09-2013, 01:05 PM
 
Location: The Triad (NC)
31,495 posts, read 70,390,130 times
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Quote:
Originally Posted by gwynedd1 View Post
I say all loans should be "jumbo loans"...
What say you?
I say Fannie, Freddie, FHA, VA, other such programs and the interest deduction too...
should be limited to the first home purchase made and to more modest "starter" home prices.
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Old 09-09-2013, 01:51 PM
 
Location: Vallejo
16,405 posts, read 18,431,657 times
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What someone is willing and able to pay for it.

And I'd agree with your MrRational. Even in the expensive Bay Area, you can buy a home for $300k or so. I'd also just entirely get rid of the mortgage interest deduction and the capital gains exemption. Anyway, this isn't a real cut. It's just finally adjusting the loan limits back to what they were before the collapse.
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Old 09-09-2013, 02:50 PM
 
19,346 posts, read 17,046,990 times
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Quote:
Originally Posted by MrRational View Post
I say Fannie, Freddie, FHA, VA, other such programs and the interest deduction too...
should be limited to the first home purchase made and to more modest "starter" home prices.

25% down and nothing less for first time buyers, and I'll think about it.
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Old 09-09-2013, 03:05 PM
 
Location: Los Angeles (Native)
25,304 posts, read 17,628,095 times
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The nice part about that is that it would most definitely lower prices (less demand)

If everyone had to put down 25% , prices would be much lower. It's the low down loans that inflate the prices..
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Old 09-09-2013, 03:15 PM
 
19,346 posts, read 17,046,990 times
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Quote:
Originally Posted by jm1982 View Post
The nice part about that is that it would most definitely lower prices (less demand)

If everyone had to put down 25% , prices would be much lower. It's the low down loans that inflate the prices..

Indeed. No money down completely dissociates the value from real cash flows, and allows people to own a theoretically infinite amount of property. If there is speculative madness, and there certainly was, there was no limit.
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Old 09-09-2013, 05:11 PM
 
Location: Vallejo
16,405 posts, read 18,431,657 times
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Quote:
Originally Posted by jm1982 View Post
The nice part about that is that it would most definitely lower prices (less demand)

If everyone had to put down 25% , prices would be much lower. It's the low down loans that inflate the prices..
Here ~40% of the homes are being sold for 100% down. I don't have a breakdown by value, but most of them would seem to be the lower priced ones. I wouldn't be surprised if 60-70% of the bottom half of the market was 100% down, and for the bottom quarter 80% wouldn't surprise me.
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Old 09-09-2013, 06:04 PM
 
Location: Chicagoland
5,728 posts, read 9,280,662 times
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Quote:
Originally Posted by gwynedd1 View Post
Indeed. No money down completely dissociates the value from real cash flows, and allows people to own a theoretically infinite amount of property. If there is speculative madness, and there certainly was, there was no limit.
No... The property purchase ceiling is reached by debt-to-income limits... Real cash flows affect reported income for securing mortgages - there is only so much work-around. If there were a way I could have owned even more property - an infinite amount even - I would have done it. I maxed out.
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Old 09-09-2013, 06:56 PM
 
19,346 posts, read 17,046,990 times
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Quote:
Originally Posted by GoCUBS1 View Post
No... The property purchase ceiling is reached by debt-to-income limits... Real cash flows affect reported income for securing mortgages - there is only so much work-around. If there were a way I could have owned even more property - an infinite amount even - I would have done it. I maxed out.
That is a limit that applies to you, but not real estate "investors" who turn them into cash flows, hedge funds or REITs. That is to say nothing of flipping them which help fuel the madness. However you do make a good point displaying how the system is rigged against the small fry. It is however immaterial for the actual resident.


Real Estate: Hedge Funds Buy Single Family Homes

I mean Donald Trump doesn't have his personal credit rating behind his loans. Its the real estate and cash flow behind it.
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