I am continually asked, "Are the problems lenders are experiencing with the sub prime loan market going to affect our real estate market in the Baton Rouge Area?" The obvious answer is both YES and NO! YES, in that people who were marginally qualified will not be able to get a home loan easily, and NO because those same people will be able to get a home loan once they do what they need to so that their credit score will be acceptable. I am still able to find 100% financing, no document loans, and such for people who have good credit scores (over 700).
One of the things we have discussed on my team is making sure we take our marginal buyers to the lender to get them prequalified in person so that we all know what has to happen in order for this person to buy a house - like we used to do 20 years ago!
The other thing we have learned is that each lender has different investors so if one client is turned down by a lender, we don't just stop there but see if anybody else can do the loan. It is VERY important right now to get credit approved before house shopping if your credit isn't perfect. Will put you in a much better position as a buyer.
The rules on sub-prime loans are changing daily so we are going back to using FHA and VA loans again. They offer more leniency for the buyer who may have a debt to income ratio that is a bit high, and offer low down-payments also. We are also sending a lot of buyers to get the BOND money (until it runs out) and we expect to see more and more of those issues coming available over the next year.
If you ever have any questions about the mortgage industry and how if might affect you personally, don't hesitate to give me a call. We'll try to help you figure out the best product for you! Call me any time at 225-298-6900