A lot has been said about the Subprime market implosion… What about the other programs?
The Alt-A market is feeling some of the same pressures…. Loan guidelines are changing daily….. so much so that it is hard to keep up with what can and cannot be done.
The good news is…. the ‘Full-Doc’ loans are ok… the people who can verify income and a little money in the bank have much less foreclosure rates.
But, the ‘Stated-Income’, ‘Stated-Assets’, ‘No-Doc’, ect loans are the ones that can no longer get 100% financing. It is even harder if the loan is for a non-owner occupied property. So, if you cannot verify income and assets, you should be able to get a hold of enough cash for 5% -10% down payment.
The market is changing…. people may have to downsize on their dream homes and put a little money down. But the market will come back some once the foreclosure rate comes back.
Tom Burris
Tom
Very well said. People in most areas will have to recognize the need to downsize on the price (perceived value) of their dream home. I sometimes think that I’m the only person I know thats not living in a million dollar plus home. The truth: Many people that I know sold their homes at over-inflated prices to buy bigger over-inflated homes using exotic loan products with ridiculously low teaser rates. I agree that markets will eventually recover, but anticipate an overall downward adjustment in housing values to correct for market imbalances.
Comment by Ed Rybczynski — March 24, 2007 @ 9:20 am