Non-Conforming rates going up???

[XBoxBoy]

A recent post

http://piggington.com/more_subprime_alt_a_pain_coming

claimed in the original post that the non-conforming lenders were in the process this week of raising rates on many (most?) of their products by 100-200 basis points. I spoke to a loan broker friend the other day and she says it just ain’t happening. I looked around on the internet news sites and can’t find any confirmation of this.

I know that there are some loan brokers on this site. Can anyone confirm this is actually happening?

Or maybe I misunderstood the original post, in which case can someone explain what is really meant? Are mortgage rates making a jump this week?

XBoxBoy

[Arraya]

Thus far, subrime has taken considerable guideline and interest rate changes depending on the lender. If they are still around.

Alt A-mild guidline changes but rates still follow the bond like prime.

Conforming-same

[Arraya]

Thus far, subrime has taken considerable guideline and interest rate changes depending on the lender. If they are still around.

Alt A-mild guidline changes but rates still follow the bond like prime.

Conforming-same

[SD Realtor]

I don’t think that is answering the question that was asked.

I have not seen any significant rate hikes in these loans discussed but I am not a mortgage broker nor am I an insider of any type.

[SD Realtor]

I don’t think that is answering the question that was asked.

I have not seen any significant rate hikes in these loans discussed but I am not a mortgage broker nor am I an insider of any type.

[Bugs]

I know that some of the commerical loan programs are increasing their rates. I’m working on an assignment right now where the bank is offering an 8.5% interest rate on a 15-year loan.

[Bugs]

I know that some of the commerical loan programs are increasing their rates. I’m working on an assignment right now where the bank is offering an 8.5% interest rate on a 15-year loan.

[Arraya]

The answer is not as simple as did rates go up.

There was not so much of a rate hike but rather a complete restructuring of guidlines for subprime. Nothing over 65% on an arm (no 2 years at all anymore), considering they used to go to 100%…

Fixed there has been a mild rate hike (maybe 20-30 bps across the board) and you can go to LTVs up to 90% still, but reduced per fico score.

On “stated loans” the rates are astronomically higher and LTVs for every fico range reduced dramatically.

On alt-a bigger “hits” for certain situations i.e NOO and second homes also LTV restrictions for fico scores. But not persay a rate hike. Alt-a still follows prime with rates slightly worse per situation.

All changes are lender dependent however there was a good bit of restructuring yesterday across the board. However, it does seem to be a work in progress.

Does that clairify?

[Arraya]

The answer is not as simple as did rates go up.

There was not so much of a rate hike but rather a complete restructuring of guidlines for subprime. Nothing over 65% on an arm (no 2 years at all anymore), considering they used to go to 100%…

Fixed there has been a mild rate hike (maybe 20-30 bps across the board) and you can go to LTVs up to 90% still, but reduced per fico score.

On “stated loans” the rates are astronomically higher and LTVs for every fico range reduced dramatically.

On alt-a bigger “hits” for certain situations i.e NOO and second homes also LTV restrictions for fico scores. But not persay a rate hike. Alt-a still follows prime with rates slightly worse per situation.

All changes are lender dependent however there was a good bit of restructuring yesterday across the board. However, it does seem to be a work in progress.

Does that clairify?

[temeculaguy]

I am not in the business but i have one example. On the weekend while touring some models I noticed a few homes were being reduced because they were almost ready and the buyers failed to qualify. The selling agent was very candid and said that he’s starting to lose deals on 0% down buyers and complained that even with good credit and income, lenders are backing away from 0 down people. He added that four months ago at the start of construction he was able to pre-qualify these people but the situation is fluid. They were willing to chop an additional 30k if the buyer could show 20% down on a non contingent deal, so that is enough evidence for me that the playing field is changing. He said all this after I explained that his floorplans didn’t work for me at any price so I can see not alterior motive for his candid remarks.

[temeculaguy]

I am not in the business but i have one example. On the weekend while touring some models I noticed a few homes were being reduced because they were almost ready and the buyers failed to qualify. The selling agent was very candid and said that he’s starting to lose deals on 0% down buyers and complained that even with good credit and income, lenders are backing away from 0 down people. He added that four months ago at the start of construction he was able to pre-qualify these people but the situation is fluid. They were willing to chop an additional 30k if the buyer could show 20% down on a non contingent deal, so that is enough evidence for me that the playing field is changing. He said all this after I explained that his floorplans didn’t work for me at any price so I can see not alterior motive for his candid remarks.

[flyer]

temeculaguy:

Just wondering if the offer to chop $30K off the selling price was from a builder or private party, and if this was in San Diego or Temecula? Just curious. Thanks.

[flyer]

temeculaguy:

Just wondering if the offer to chop $30K off the selling price was from a builder or private party, and if this was in San Diego or Temecula? Just curious. Thanks.

[temeculaguy]

Flyer, it was a builder and it was in Temecula. While the R/E market is more fragile here the financing rules are more universal, on another board they are posting some internal memmos about tightening standards that are inline with what I am seeing and hearing. The “have a pulse and you qualify” days seem to be ending and that is goig to hurt sellers. Now you have to not only find someone who wants your house, you have to find someone that can afford it.

[temeculaguy]

Flyer, it was a builder and it was in Temecula. While the R/E market is more fragile here the financing rules are more universal, on another board they are posting some internal memmos about tightening standards that are inline with what I am seeing and hearing. The “have a pulse and you qualify” days seem to be ending and that is goig to hurt sellers. Now you have to not only find someone who wants your house, you have to find someone that can afford it.

[Author]

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