The Market/Mortgage Mess and You!
What a rough couple of weeks it has been. Headlines such as “Another Mortgage Lender Teeters on Bankruptcy,” “Dow Plunges 300 Points in Turbulent Session,” and “Mortgage Mess, Who is To Blame?” If you have been following this saga like I have, you have undoubtedly heard about the growing delinquencies on loans that have hit hedge funds and investors of publicly traded lending companies. The one question I have had people ask me is…. what does this mean to me if I am trying to buy or sell a house?
Depending on your loan amount and credit rating, things could better or worse for you. For those buyers with excellent credit who are taking out loans of less than $417,000, rates have begun to slide down a bit as borrowers like you (with excellent credit history and credit scores) are in demand.
“Jumbo” loans are those loans in excess of $417,000, which exceeds the limit for those eligible for purchase and guarantee by mortgage institutions such as Fannie Mae and Freddie Mac. Rates of these loans have jumped almost a full percentage point since these loans are now considered more “risky.” For real estate markets such as our Northern Virginia markets (Fairfax County, Prince William County, Stafford County, Fredericksburg, etc.), sellers of more expensive homes may face a slowdown as buyers who need jumbo loans sit on the sidelines and take a “wait and see” approach.
For those buyers with less than stellar credit, things are going to get a lot tougher. Lenders are tightening up standards, requiring borrowers to have down payment funding (2.5%, 5%, 10% down) and requiring more stringent income and asset verifications.
People still need to sell their houses for any number of reasons and there will always be people to buy them! However, right now the buyers seem to be in shorter supply and the numbers of sellers are steadily increasing. The two keys things for any seller and/or buyer are price and condition of a house. Now more then ever this is going to crucial for a home to possess the right balance of price/conditions that moves the house for the seller and pleases the buyer!
Depending on your loan amount and credit rating, things could better or worse for you. For those buyers with excellent credit who are taking out loans of less than $417,000, rates have begun to slide down a bit as borrowers like you (with excellent credit history and credit scores) are in demand.
“Jumbo” loans are those loans in excess of $417,000, which exceeds the limit for those eligible for purchase and guarantee by mortgage institutions such as Fannie Mae and Freddie Mac. Rates of these loans have jumped almost a full percentage point since these loans are now considered more “risky.” For real estate markets such as our Northern Virginia markets (Fairfax County, Prince William County, Stafford County, Fredericksburg, etc.), sellers of more expensive homes may face a slowdown as buyers who need jumbo loans sit on the sidelines and take a “wait and see” approach.
For those buyers with less than stellar credit, things are going to get a lot tougher. Lenders are tightening up standards, requiring borrowers to have down payment funding (2.5%, 5%, 10% down) and requiring more stringent income and asset verifications.
People still need to sell their houses for any number of reasons and there will always be people to buy them! However, right now the buyers seem to be in shorter supply and the numbers of sellers are steadily increasing. The two keys things for any seller and/or buyer are price and condition of a house. Now more then ever this is going to crucial for a home to possess the right balance of price/conditions that moves the house for the seller and pleases the buyer!
posted by kristinburns at 5:35 PM
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