How will radical changes in mortgage underwriting effect you?
If you are like many people you are wondering what is going on right now in the residential mortgage world. In the last few days I have watched the reactions to Wall Streets distaste for Alternative Documentation Mortgages. This a result of poor performances on those loans. The rising foreclosure rates across the country have had a direct impact on the correction that is taking place right now on the mortgage industry.
Gone are the days where you could “state” (not verify) your income and buy your investment property with no money down. Gone are the days where you could “cash out” the equity in your home to 100% of the value of the house. These couple of examples are only the tip of the iceberg.
What will happen I project is that many people will return to the way they bought homes in the past. You will have to rely more on FHA, VA, FNMA to get your home loan approved.
What this means for you is it is going to be more important to work with an experienced loan officer who can assure that your loan will get approved, closed, and funded! For example, did you know a homebuyer can have zero credit? I mean zilch credit established! I don’t mean only bad credit mind you. Even today and tomorrow that person could buy a home with little to no money down AND get a 30 year fixed rate at about 6.5% (which is currently lower then the Freddie Mac 30 Year Average.
PLEASE, when you are “shopping” for a home loan now and into the future be more concerned about the integrity, credibility, and experience of your loan officer / mortgage banker / mortgage broker then you are about “shopping rate”. Afterall, if someone promises you a rate that sounds far fetched and things change before or at closing, don’t be surprised when you are feverishly scurrying to the bank to bring more money to the title company or digesting being told that your rate is higher then you were promised and ultimately you are forced to make a higher mortgage payment.
Please call if you are buying a home, thinking of buying a home, refinancing your home because your adjustable rate is going to change and payment is going up. If you need honest advice about mortgage rates, financing and the smart way to get qualified for a home loan and do it right the first time, in the new world of mortgages
Please call Ray 303-779-0591