With these elements missing, mortgage money will be more expensive and difficult to find.
Buyers with a $400 car payment will qualify for $56,000 less home/loan regardless of compensating factors-every $100 in fixed monthly debt = $14,000 less home/loan. We use a company that specializes in auto refinancing to lower payments by as much as 65%.
Do your research-Government and CRA funding is available to First TIme Home Buyers in California.
Home Buyer Service
The mortgage crisis is just a sympton of the pattern of behavior that has gone on for some time.
How will affect your ability to obtain a loan? That depends entirely on you. If you know you want to purchase a home in the future (near or distant) start saving now, start fixing your credit, and be ready to bring all your proof of employment to the table.
If you come prepared and in good financial health - you should be able to obtain a traditional loan - the process will just be more stringent and they will scrutinize your information much closer.
This is a win win for you the consumer as you will be more apt to purchase a home you can actually afford and not mortgage yourself into a foreclosure. The industry will benefit because they have responsible consumers in homes they can afford and pay for accordingly.
Don't get discouraged - GET PREPARED. Good luck to you in your pursuit of the American Dream!
Yes, this is true. In fact, itâ€™s already happening. This is as a result of all of the foreclosures and short sales occurring, which are a result of all of the 100% financing and no doc loans issued over the last few years. Many loans were issued to people that should never have qualified, so as a result, they are being much more cautious on who they lend to. Additionally, some large institutions have filed for bankruptcy, decreasing the lending power overall.
Melissa Mancini, Realtor, CBR, GRI
If you are looking to do something like a no doc loan, or any other non-conforming loan (stated income, etc) or anything above $417,000 then you will have difficulty, no matter what your credit score. This according to my mortgage rep. If you would like more information, email me at firstname.lastname@example.org. I can give you his contact information and he will be able to go into more of the details for you.
I live in the Bay Area, so it's definitely going to be a loan over $417. My FICO score is ok, but less than 700, and I went to graduate school so my debt is pretty high. On the flip side, both my husband and I have strong job histories and incomes.
From what you all are saying - sounds like a mortgage at rates that I'd want to pay isn't in my near future. Seems hard to believe given that my situation is a pretty common one in the Bay Area. Sigh.
There will be fewer buyers in the market, as a result of tightening guidelines on credit. This will make the pool of buyers left a smaller pool with greater negotiating power.
For sellers, the tightening of credit is not good news since it reduces the number of potential buyers.