Mob psychology may actually be changing

[HLS]

$417K is LOAN AMOUNT, has nothing to do with property value.

GSE’s don’t buy loans above this amount, except if the property is in Hawaii or Alaska, then the limit is $625,500.
Go figure.

Loans that are above 80% of the appraised value (but still under $417K) will require mortgage insurance.

I had a borrower sign docs on Friday, 95% loan. 30 YR Fixed, 6.25% PLUS MI payment.

He didn’t qualify for 6.74% without separate MI payment because he went stated.

[j]

It will be harder to get loans even with documentation, because foreigners US investors will pull their money out of US markets altogether as the dollar drops. Stagflation is just around the corner. Plus the US investors that stay domestic will not trust the mortgage firms that are desperate to sell loans. May loans will have to be more traditional, were the originator actually services the loan.

[j]

It will be harder to get loans even with documentation, because foreigners US investors will pull their money out of US markets altogether as the dollar drops. Stagflation is just around the corner. Plus the US investors that stay domestic will not trust the mortgage firms that are desperate to sell loans. May loans will have to be more traditional, were the originator actually services the loan.

[j]

It will be harder to get loans even with documentation, because foreigners US investors will pull their money out of US markets altogether as the dollar drops. Stagflation is just around the corner. Plus the US investors that stay domestic will not trust the mortgage firms that are desperate to sell loans. May loans will have to be more traditional, were the originator actually services the loan.

[bsrsharma]

I think that half-million will be the new magic number…

Yes, $521,250 is the Magic Number. I am predicting a Limbo dance around that.

http://en.wikipedia.org/wiki/Limbo_(dance)

[bsrsharma]

I think that half-million will be the new magic number…

Yes, $521,250 is the Magic Number. I am predicting a Limbo dance around that.

http://en.wikipedia.org/wiki/Limbo_(dance)

[bsrsharma]

I think that half-million will be the new magic number…

Yes, $521,250 is the Magic Number. I am predicting a Limbo dance around that.

http://en.wikipedia.org/wiki/Limbo_(dance)

[CostaMesa]

HLS: Am I reading that right…your client didn’t qualify for 6.74% but did qualify for 6.25%? Is the MI payment bigger than the marginal payment difference of the lower interest rate?

Thanks for helping us newbs out with the real deal…

[CostaMesa]

HLS: Am I reading that right…your client didn’t qualify for 6.74% but did qualify for 6.25%? Is the MI payment bigger than the marginal payment difference of the lower interest rate?

Thanks for helping us newbs out with the real deal…

[CostaMesa]

HLS: Am I reading that right…your client didn’t qualify for 6.74% but did qualify for 6.25%? Is the MI payment bigger than the marginal payment difference of the lower interest rate?

Thanks for helping us newbs out with the real deal…

[LA_Renter]

HLS, I agree with you that getting a loan is not as dismal as many are saying but what is dismal are the loans that are available juxtaposed to current home prices. Yes nonconforming loans will come back on the market but I can guarantee you they will not look anything like they did during the boom, they will be at much higher rates. From what i am seeing and hearing it is the underwriting of the conforming, jumbo and non-conforming loans that is experiencing the most profound change i.e they are actually underwriting the loans now. I think we all agree it is a good thing to see sanity come back into the lending industry. But there are going to be consequences. We are seeing falling home prices now and in some cases severe drops. That puts the lender in a bind to loan money for an asset that is falling in value due to the unknown reaction of the conforming good credit borrower facing a home which will be valued at substantially less than the balance of the loan. It is going to take a long time to get through this phase.

[LA_Renter]

HLS, I agree with you that getting a loan is not as dismal as many are saying but what is dismal are the loans that are available juxtaposed to current home prices. Yes nonconforming loans will come back on the market but I can guarantee you they will not look anything like they did during the boom, they will be at much higher rates. From what i am seeing and hearing it is the underwriting of the conforming, jumbo and non-conforming loans that is experiencing the most profound change i.e they are actually underwriting the loans now. I think we all agree it is a good thing to see sanity come back into the lending industry. But there are going to be consequences. We are seeing falling home prices now and in some cases severe drops. That puts the lender in a bind to loan money for an asset that is falling in value due to the unknown reaction of the conforming good credit borrower facing a home which will be valued at substantially less than the balance of the loan. It is going to take a long time to get through this phase.

[LA_Renter]

HLS, I agree with you that getting a loan is not as dismal as many are saying but what is dismal are the loans that are available juxtaposed to current home prices. Yes nonconforming loans will come back on the market but I can guarantee you they will not look anything like they did during the boom, they will be at much higher rates. From what i am seeing and hearing it is the underwriting of the conforming, jumbo and non-conforming loans that is experiencing the most profound change i.e they are actually underwriting the loans now. I think we all agree it is a good thing to see sanity come back into the lending industry. But there are going to be consequences. We are seeing falling home prices now and in some cases severe drops. That puts the lender in a bind to loan money for an asset that is falling in value due to the unknown reaction of the conforming good credit borrower facing a home which will be valued at substantially less than the balance of the loan. It is going to take a long time to get through this phase.

[HLS]

He actually did qualify for the 6.74% payment, the lender approved it and locked it that way. On day of drawing docs, lender called me and said that program didn’t allow lender paid MI…which was an add of .49%
So they changed it to 6.25%, with an MI payment.

It was lender mistake. I got my borrower a $1,000 credit for their mistake. He was OK with it, still a great loan for 95%.

His payment will be about $120 a month higher until MI can be removed, and then he will save $130 a month at the lower rate for the life of the loan.
He plans on staying there a long time, so it may actually work out better for him in the long run.

With a 30 YR amortization, a loan is at 80% after 10 years, and about 78% after 11 years.
He may be paying the loan down sooner, and get rid of the MI.

[HLS]

He actually did qualify for the 6.74% payment, the lender approved it and locked it that way. On day of drawing docs, lender called me and said that program didn’t allow lender paid MI…which was an add of .49%
So they changed it to 6.25%, with an MI payment.

It was lender mistake. I got my borrower a $1,000 credit for their mistake. He was OK with it, still a great loan for 95%.

His payment will be about $120 a month higher until MI can be removed, and then he will save $130 a month at the lower rate for the life of the loan.
He plans on staying there a long time, so it may actually work out better for him in the long run.

With a 30 YR amortization, a loan is at 80% after 10 years, and about 78% after 11 years.
He may be paying the loan down sooner, and get rid of the MI.

[Author]

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