Sunday, September 30, 2007
Despite Crunch, Mortgage Money is Still Available
"The term mortgage meltdown has become so common -- on television, in headlines and even casual conversations -- that you might assume that this is a tough time to get a mortgage."
"But the reality is different: Mortgage money is plentiful, most mortgage products remain unaffected by troubles in the subprime segment, and interest rates for 30-year fixed-rate loans remain in the low 6 percent range for people with reasonably good credit. Even interest rates on loans of more than $417,000 have fallen after spiking during the summer." - Kenneth Harney, Nation's Housing
The main change during the past several months, said Ted Grose, president of 1st Mortgage Advisors in Los Angeles, is that "the products that allowed people to buy houses they couldn't afford have disappeared."
"Larger mortgages, which always have carried higher rates than loans eligible for purchase by Fannie Mae and Freddie Mac, have recently been in the low 7 percent range, down from the 8 percent and higher levels of a couple of months ago."
"Nonetheless, say lenders and brokers, there is a widespread and persistant belief by consumers that the entire mortgage market is in crisis."
"Other than subprime and high LTV (loan-to-value) stated-income" programs, Jim Brown, chief executive officer of Veteran Mortgage said, "we've got pretty much everything now that we did before. We've got a lot of outlets."
"Most lenders and investors are quick to note that while mortgage money is plentiful, underwriting standards are stricter than they were a year ago."
"Similarly, FICO score standards generally are higher than a year ago, stated-income mortgages with no verifications are hard to find, and major investors are on the prowl for anything hinting at fraud."
"Lenders are especially wary of excessive "layering of risk" - combining low down payments with marginal FICO scores and high-to-income ratios - in markets where prices are falling."
"A major legislative development under way on Capitol Hill could expand consumers' range of good mortgage choices even further."
Read the entire Article HERE.
"But the reality is different: Mortgage money is plentiful, most mortgage products remain unaffected by troubles in the subprime segment, and interest rates for 30-year fixed-rate loans remain in the low 6 percent range for people with reasonably good credit. Even interest rates on loans of more than $417,000 have fallen after spiking during the summer." - Kenneth Harney, Nation's Housing
The main change during the past several months, said Ted Grose, president of 1st Mortgage Advisors in Los Angeles, is that "the products that allowed people to buy houses they couldn't afford have disappeared."
"Larger mortgages, which always have carried higher rates than loans eligible for purchase by Fannie Mae and Freddie Mac, have recently been in the low 7 percent range, down from the 8 percent and higher levels of a couple of months ago."
"Nonetheless, say lenders and brokers, there is a widespread and persistant belief by consumers that the entire mortgage market is in crisis."
"Other than subprime and high LTV (loan-to-value) stated-income" programs, Jim Brown, chief executive officer of Veteran Mortgage said, "we've got pretty much everything now that we did before. We've got a lot of outlets."
"Most lenders and investors are quick to note that while mortgage money is plentiful, underwriting standards are stricter than they were a year ago."
"Similarly, FICO score standards generally are higher than a year ago, stated-income mortgages with no verifications are hard to find, and major investors are on the prowl for anything hinting at fraud."
"Lenders are especially wary of excessive "layering of risk" - combining low down payments with marginal FICO scores and high-to-income ratios - in markets where prices are falling."
"A major legislative development under way on Capitol Hill could expand consumers' range of good mortgage choices even further."
Read the entire Article HERE.
Labels: Bay Area Real Estate, Fico Score, Interest Rate, Jumbo Loans, Mortgage Lenders, San Francisco Chronicle, Subprime Loans
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