With all this posting, including mine, I don’t beleive these guidelines are in effect. They’ve been talking about this for several years. I do know they’ve instituted the limit on what the seller can “pay” in closing costs. It used to be 5%, or maybe a little more, can’t remember. Now it’s $3,000.
I meant “stated income” when I said “B” paper loans. Many people were buying homes who should not have been buying them. Those people were weeded out about 2 years ago. Up until we got out of the biz in early 2011 a buyer had to have a 680 credit score, minumum 3 1/2% down and ratio no more than 50%.
The guidelines have been moving constantly since 2007. Then you could buy with a 400 credit score with seller paid down payment and seller paid closing costs. Basically no money down if you had a job. Then it moved to 580. Then 620 with 3 1/2% down payment. And now it’s up to 680 (unless it’s gone up again) and a maximum of 3% seller “contribution”.
Personally I see many more people walking away. That means banks crashing and builders going under. There’s no fair and easy way out of this.
I hate to say this, but instead of all the crap they’ve tried to do to fix the housing market, we’d have been better off, both in overall cost, and effectiveness, to subsidize loan modifications where principal was reduced (to reduce walkaways) in the first place.
Not saying I *like* that idea either, but it would have been more effective.
I know most mods now fail, but that’s based more on how they’re done and for whom (i.e., they’re only done for people who really can’t afford the house no matter what and already have credit issues from the get-go) than anything else.
You have my vote to be the next Treasury Secretary. An absolutely brilliant comment.
More brilliant than my voice mail message:
"If you agree with me that true conservatism is the last best hope for this country, feel free to leave your name, number, and a brief message."
"If not, then Good Day and GOOD LUCK!!!"