Question by eripapito: How are the mortgage companies now? Are they flexible now to loan money to people?
I know 4 or 5 months ago they were so strict, don’t matter if you have a 700 FICO score. I heard they change guidelines again and are more flexible. Is this true?
Best answer:
Answer by Celine
I have heard that if your credit score is good and you have some downpayment money, there are loans to be had.
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the mortgage industry is blah right now. i work with mortgage clients all day long with there marketing. i was at a tradeshow in la in aug…and it was more of a job fair than anything..
now – rates are pretty low, but you have to have a descent credit (660+) and equity in your home to get a loan. the housing market in CA is terrible right now. people purchased homes for 400-500K a few years ago, over night (it seamed) they were worth 700-800K+ and they took equity out to invest. now that the market is terrible, these homes are back to 400K in value – but they refied a few yrs back for 700K+. they are totally upside down.
the market it so bad right now because there are people who shouldnt have gotten loans who did…and various other reasons. there are tons of arm’s out there that are adjusting. stated income was a big thing back then that isnt now, and mortgage companies hate that.
if you are in the market to get a loan, have some money saved up for a down payment, make sure you are getting a good deal on the house and will not go upside down in it (after all – it is a house which is an investment. it shouldnt be like a car…), good credit, and please…get a 30 or 15 year fixed. stay away fromt he arms. they will hurt you in the long run..
hope this was a little insite.
A 700 FICO may no longer be that with fair Issac changing the way they evaluate credit risks. If you have that score and no new problems you should be looking good for a loan with an even higher FICO. The lenders are looking for credit worthy borrowers. The question here is do you feel the housing slump has slowed or even reversed. With the current 10.5 month backlog of used homes for sale I say there is downward pressure on housing prices. Some areas will see a much more dramatic push down. You also have to ask will your income be outsourced leaving you with the need to retrain. We are now in a very global market and our housing prices will be effected by jobs going to China and India for the next 3 decades. ECNobody
It depends what you mean by “flexible”. The industry has learned that the FICO score isn’t all that important. People who borrow more than their income will cover will tend to default, even with a great FICO score. People who don’t put any money down have nothing to lose and are more likely to default, even with a great score. People who can’t afford a regular market rate now but get in with a “teaser” rate will probably still not be able to pay in two years when the teaser period ends regardless of score.