I don't like delivering bad news, and I know you don't like receiving it (I get unsubscribes). At the same time I want to tell you what I see: There are some serious (additional) problems right now, directly affecting real estate. It looks to me like it's going to get a lot worse worse before it gets better. Yet, when doors close, others open - there are resulting opportunities as well (See below). Here are some of the reasons/symptoms:
-
1.5 million homes in foreclosure
- Collapsing commercial market. Commercial paper falls most ever
- Slow implementation by lenders of loan modification iniatives.
Articles
What this means in practical terms
- Appraised values as much as 30-40%(!) low, especially for refi's
- Restrictive lending environment, and tightening up more
- Construction loans virtually unavailable (unless hard money)
- Hard money lenders are raising lending criteria and pricing
- Conventional financing maximum is 90%ltv
- PMI requires 680 Fico
- Higher lending standards and erratic pricing for commercial loans
Good news, opportunities
- Investments with good cash on cash returns available
- Affordable price levels - especially for first time home buyers
- First Time Homebuyer tax credit (must close by Nov 30th!)
- Rehab homes (foreclosures) can be bought with 203(k) loans
- FHA loans, including FHA rehab loans (203k), readily available
- Higher Fico's get lower rates
- Rates are not likely to increase (I think)
Available
- Direct lender for FHA, Fannie, Freddy, VA, USDA, Jumbo, and other loans
- Same day loan decision (pre-approvals)
- 30-day closes (45-days for FHA)
- Condo (conversion) financing services.
Information
- FHA loans down to 560 Fico
- 50-70% LTV stated income loans (600-700 Fico needed)
- 95% LTV Fannie Mae condo loans
- Loans for non-residents
- Rehab and construction loans
- Non-warrantable property
- Reverse mortgages
- Commercial loans
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"To accomplish great things, we must not only act, but also dream;
not only plan, but also believe."
Anatole France (1844-1924)
;)
;)
This is a really good post I do not even read the NAR posts with their rose colored glasses. Telling it like it is is not being a doom and gloomer. Thanks fo this post