The last couple of months have been really volatile...Daily news articles about the Real Estate bomb and Mortgage Melt-Down and merging banks and Bank Closures...is it really because of people who had poor credit or because of sub-prime loans?
I don't think so...I think it's nice to have someone to blame, but how about the in the United States. We as a society "like to live" outside our means! We like to go on the nice vacations or buy the nice cars or t.v.'s in all the rooms of our homes! It's really the old adage of keeping up the "the Jones"!
It really isn't the only people who bought a home with 100% financing, it's also the people with 700+ credit scores that refinanced themselves to death with the booming market, with every refinance and money taken out it was for example: $400k home with a mortgage of $2300 a month, then your home appraised at $600k because homes in your area went on the market and were selling like crazy, so now your $400 house is worth over $600k and now you owe $600k and instead of a mortgage you could afford at $2300 a month you now are paying $3600 a month! This is where the problem started and where we are right now!
We have to ask ourselves is it responsible lending? or responsible borrowing? Yes, there are some Brokers out there that have taken advantage of clients, but because we didn't ask the questions or because we wanted that money right now and didn't want to start the process all over again! We didn't ask for our "Good Faith Estimate" to know exactly what we were getting and believed on a hand-shake this slick person on the phone telling us no problem, everything is great and switched it on us at the last minute.
I talk to people on a daily basis who qualified for $250k mortgage, but wanted the huge house in a top neighborhood, but didn't want to hear they only qualified for $250, but want to buy the $450k house and don't like to hear they can't afford it!
There are still options for people who want to buy a home and don't have the best credit, you just have to have the realization that you need to start somewhere and it doesn't have to be a $500k house. The market will rebound and home prices will go up, so why not make a smart move...get into a home you can afford and wait the 3-4 years and live in your home and then move up! Save a little money be sure you want to buy and then take the step..it's a big one, but having the right people on your side to help you succeed makes all the difference in the world!
You may not use our company to find your next dream home but here are some tips to know when you are getting the right loan!
1. Is the Loan Agent a Licensed Individual
2. Is the Company a Licensed Broker
3. Always Always ask for a "Good Faith Estimate"
4. How many points are you paying? What goes to the broker and what is going to the Lender?
(you shouldn't be paying any more than 1point to a broker) (if buying down your interest rate you are buying it down directly from the Lender)
5. Do you have a pre-payment penalty and how much to get out of that pre-pay.
6. Know the Terms of your Loan
7. If in doubt...always always ask questions!
don't be afraid to say "no" and walk away!
Subscribe to:
Post Comments (Atom)
0 comments:
Post a Comment