Money Morning

The overall trend of mortgage rates appear to be rising both fixed and Arm money. With the collapse of Taylor Bean&Whitaker, expect rates to go slightly higher as well as turn times increasing. The fall of TBW will put a strain on the remaining investors who already have choked pipelines. The thousands of loans in TBW's pipeline will take awhile to assimilate to other brokers and investors. How long this will take is anybody's guess. Remember TBW was the 3rd largest FHA originator as well as the 10th overall.
 
Brace yourself and your customers for higher rates. As the economy gets better, rates go up. The most affected area will be the Debt to Income condition. Most investors are clamping down hard on LTV's and borrowers QUALIFYING for the loan. This means, they want no more than a 33/41. (33 is the front end housing ratio/41 is the back end full debt ratio)
 
Investors remain adverse to any risk. LTV's and FICO restrictions are prohibitive for all but A PAPER. A PAPER now days translate to a 720 or higher mid FICO, with 740 being preferred. Just a few months ago, 680 was considered A PAPER. At present 620 Mid FICO is the minimum for ALL loans, with some going as high as 640. There are a few investors who still do low 600 and 500 FHA loans, with lots of restrictions, but they are few and far between.
 
As I have always said, there is always a way to structure a loan to get your customer in a house. The more info the better. With the current climate very restrictive, it will take every one on the same page to make a deal happen. If you have deals that have been turned down or not sure what direction to take give me a shot.
 
GOOD SELLING!!!
 
 
Greg Brown
Buckhead Residential Services
678-943-0423
gregbrown@buckheadresidentialservices.com
gregbrown93@gmail.com