I give up and I do not know what they are doing out there. I guess it is a different standard for them.

Stewart,  We have the same program here in our area.  We just closed one today.  The only good that might come out of this is the fact that the 102 % loans are on properties that are about 75% - 80% of the value of a few months ago.  So if they do recover their value the 102% loan is in fact a loan of 77%  to 80%. 

It is a USDA Loan, must meet certain guidelines.  I have heard and read where people are blaming the 100% loans for foreclosures, but I don't believe it

I don't blame the 100% loans entirely for the foreclosure problem, but it certainly helped create the problem where unqualified buyers were enabled to buy property they could not afford.

Stewart,  I have the same issues with some Realtors.  I have seen a few times Realtors are advising clients on financing issues that were just wrong.  Example: Realtor telling my buyer to look at another lender who won't require an appraisal.  The client's situation dictated a FHA loan.  Guidelines on a FHA require an appraisal.  She is a seasoned agent wanting to get around an issue found in the appraisal.  Another issue, a Realtor telling a client to go to his buddy to get an RD loan to save an 1/8 of a point on interest.  Of course, the Realtor doesn't have to disclose the APR which makes the loan a lot more expensive.   Oh my favorite,  I told a client with her debt ratio she qualifies for a 120k loan; however, looking at her situation I personally would look for houses in the 90k.  So, why is the Realtor showing 130k homes?  Realtors for the most part do not have a clue about financing and the guidelines we are held to.  Just like I don't know the ins and outs of a sales contract.  I think instead of blaming each other for the foreclosures situation we all should accept our part and get on with business.

Jimmy - my biggest concern is where an over eager buyer hears only what he wants to and proceeds with a purchase while not fully appreciating the possible implications of his actions.

Fortunately I hold my Series 7, Series 66 and Series 3 Licenses which provides me with extensive knowledge about Finance and especially Debt Securities. Over the last 5-6 years I've had to stop clients from taking negative amortization loans which have obviously proven to be problematic in the current market.

WOW....I have never heard of 102% financing!  It does not sound like a very good idea, but I am not familiar with this kind of a loan program.

Debra - these 100% plus programmes were some of the very same loans that enticed many unqualified Buyers to purchase Real Estate during the recent boom years.