Good times are back

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Submitted by wallers on April 18, 2015 - 8:51pm

Let's see historical low interest rates for historical length of time. QE easing. Affordability at all time lows, and now loosening of credit to make these unaffordable homes affordable. hmmm

Article about credit unions doing more mortgage volume.

By offering loans that address their needs — zero down payments, no private mortgage-insurance premiums, plus the standard low down-payment menus of the Federal Housing Administration (3.5 percent minimum) and the Department of Veterans Affairs (zero minimum) loans.

Also
closely watched index that tracks mortgage credit availability — lender requirements on credit scores, down payments and other key loan terms — has some good news for potential home buyers: Things are finally loosening up.

After years of progressively tighter rules on borrower eligibility in the wake of the housing bust, banks and mortgage companies have begun modestly easing their requirements and even expanding the types of mortgages they offer. The Mortgage Bankers Assn.'s latest credit availability index reported improvements in all four of its loan categories during January. The improvements mainly reflect positive lender responses to government efforts to ease regulations and improve affordability in the housing market — all of which means an improved environment for mortgage shoppers.

Among the initiatives: giant investor Fannie Mae's resumption of purchases of conventional mortgages with as little as 3% down. Freddie Mac, another major investor, is planning to begin similar 3% down loan purchases for mortgages closed on or after March 23.
cComments

And there is your "top" ladies and gentlemen! Sell sell sell.
wascoman
at 8:31 AM March 02, 2015

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23

According to Mike Fratantoni, chief economist for the mortgage banker's group, "roughly 40% of investors" already have begun offering the Fannie 3% down program. The guidelines for the Freddie Mac program are in lenders' hands and there's likely to be a strong rollout for it as well.

Also contributing to better affordability: the Federal Housing Administration's reduction late last month of its costly upfront mortgage insurance premiums, a move that could expand eligibility for home purchases to thousands of buyers, according to industry estimates. Virtually all lenders who work with the FHA program began offering the lower mortgage insurance premiums when the reduction took effect in late January. The FHA insures loans with down payments as low as 3.5%.

Brad Blackwell, executive vice president of Wells Fargo Home Mortgage, the country's largest-volume mortgage originator, is certain about what's underway in the market: "Things are looking better for home buyers and refinancers" — not only in terms of underwriting requirements but in the cost of credit as well.

Wells Fargo has been "gradually opening up the credit box," Blackwell said, in part because of helpful policy clarifications and changes at Fannie Mae and Freddie Mac. Those changes give lenders greater confidence in lending to a broader spectrum of borrowers, including those who don't have high credit scores and ready cash for big down payments.

For example, he said, although the bank previously had a credit score minimum — 660 FICO on conventional loan applications — now it requires no hard and fast minimum. Instead, if Fannie Mae's and Freddie Mac's automated underwriting systems accept the application — say you've got a relatively low credit score but strong compensating factors such as solid income, ample reserves and a large-enough down payment — the bank won't say no to you solely because of the low score.

This could be especially important to people who had tough economic experiences during the recession that damaged their credit but who are now excellent candidates for a loan. On FHA applications, the bank will now accept FICO scores as low as 600, down from its previous 640 standard.

Submitted by spdrun on April 18, 2015 - 8:58pm.

Well, they're not lending to every skell who can fog a mirror. Yet.

Submitted by Coronita on April 18, 2015 - 9:04pm.

cool. This time it's different though. This time i'll have more than 1 property i can sell.

Submitted by wallers on April 18, 2015 - 9:12pm.

Good one from the WA Post. Arms are back. But they are different this time so it's all good.

http://www.washingtonpost.com/sf/busines...

Submitted by spdrun on April 18, 2015 - 9:18pm.

ARMs never went away as portfolio loans. Per QM standards, they can't be securitized as residential loans, so they'll remain a niche market.

Submitted by flyer on April 18, 2015 - 9:30pm.

Should be interesting to see how long we can float the game this time. Of course, some people will use this opportunity wisely, but, for the most part, it will probably simply add to the already exponential ranks of the "low or no equity" population, which will not bode well for their retirement years.

Submitted by an on April 19, 2015 - 10:01am.

flu wrote:
cool. This time it's different though. This time i'll have more than 1 property i can sell.

+1. Depends on how high it goes before it crash. I might just keep them and add more at the bottom. We'll see.

Submitted by The-Shoveler on April 20, 2015 - 10:17am.

AN wrote:
flu wrote:
cool. This time it's different though. This time i'll have more than 1 property i can sell.

+1. Depends on how high it goes before it crash. I might just keep them and add more at the bottom. We'll see.

If your going to sell and be done with a property I think that is fine. But IMO it is very unlikely we would see the kind of decline that would make it worth it to sell and try to buy again just for the profit.

That was a once in a life time (thank goodness).

anyway IMO.

Submitted by deadzone on April 20, 2015 - 12:58pm.

The-Shoveler wrote:
AN wrote:
flu wrote:
cool. This time it's different though. This time i'll have more than 1 property i can sell.

+1. Depends on how high it goes before it crash. I might just keep them and add more at the bottom. We'll see.

If your going to sell and be done with a property I think that is fine. But IMO it is very unlikely we would see the kind of decline that would make it worth it to sell and try to buy again just for the profit.

That was a once in a life time (thank goodness).

anyway IMO.

Once in a lifetime? Looks like history is about to repeat itself in the near future. Thing about the last crash, it was never allowed to complete its downward cycle due to aggressive government bailouts and Fed money printing. Next time, although the house price depreciation may not be so dramatic, with little ammunition left from the Fed, may be a very long period decline.

Submitted by Coronita on April 20, 2015 - 1:31pm.

Ill be too old enough to care next time. I intend to enjoy things while I'm still young(er), though 40ish is pretty old these days.

Submitted by an on April 20, 2015 - 2:34pm.

The-Shoveler wrote:
If your going to sell and be done with a property I think that is fine. But IMO it is very unlikely we would see the kind of decline that would make it worth it to sell and try to buy again just for the profit.

That was a once in a life time (thank goodness).

anyway IMO.

It all depends on how high it does and how quick it gets there. My crystal ball is broken, which is why I'm leaving all potential response on the table. If we see 2005-6 inflation (3-5%) adjusted price soon, then hell yeah I'll sell, I might even sell my primary. Key word is it has to be inflation adjusted from 2005-6 price, not the 2005-6 nominal price. Which mean, your average 1/1 condo in MM would be $350-400k, your average 2/2 condo in MM would be $500-550k, your small 3/2-4/2 in MM would be $850-900k, the larger house in MM would be $1.05-1.1M, etc.

Submitted by an on April 20, 2015 - 2:35pm.

flu wrote:
Ill be too old enough to care next time. I intend to enjoy things while I'm still young(er), though 40ish is pretty old these days.
I'll never be too old to care.

Submitted by bearishgurl on April 20, 2015 - 3:20pm.

AN wrote:
The-Shoveler wrote:
If your going to sell and be done with a property I think that is fine. But IMO it is very unlikely we would see the kind of decline that would make it worth it to sell and try to buy again just for the profit.

That was a once in a life time (thank goodness).

anyway IMO.

It all depends on how high it does and how quick it gets there. My crystal ball is broken, which is why I'm leaving all potential response on the table. If we see 2005-6 inflation (3-5%) adjusted price soon, then hell yeah I'll sell, I might even sell my primary. Key word is it has to be inflation adjusted from 2005-6 price, not the 2005-6 nominal price. Which mean, your average 1/1 condo in MM would be $350-400k, your average 2/2 condo in MM would be $500-550k, your small 3/2-4/2 in MM would be $850-900k, the larger house in MM would be $1.05-1.1M, etc.

Um ... AN, I don't see any of the above happening in the forseeable or unforseeable future. So, you probably should plan on keeping any real property you happen to own in MM for the rest of your life and let your "heirs" figure out what to do with it.

Submitted by an on April 20, 2015 - 3:45pm.

bearishgurl wrote:
Um ... AN, I don't see any of the above happening in the forseeable or unforseeable future. So, you probably should plan on keeping any real property you happen to own in MM for the rest of your life and let your "heirs" figure out what to do with it.
Never say never. Bubble have happened in the past and it'll happen again. When and how big, who knows. But I'm keeping everything on the table and make my decisions based on the current data. If I never see that price, that's perfectly fine by me. I won't lose any sleep. I bought these properties with plans to pass it on to them anyways, so selling would actually be a change in my plan, not the other way around.

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