Money has an article on who can’t get a mortgage now.
The stock market is going crazy. Hedge funds are going under. But for the average American looking for a home loan, the crisis in the subprime mortgage market may actually be good news.
“Not only is it nothing to worry about, it’s an absolute positive,” said Loni Graiver, president of the Maine-based Cumberland County Mortgage. “Not only have [home] valuations come down, but [interest rates] are still historically low.”
Rates on 30-year fixed loans dipped last week, to 6.41 percent, according to the Mortgage Banker’s Association.
In addition, tightened lending standards stemming from the subprime crisis likely mean fewer buyers, pushing down home prices.
The one catch is this: You’ve got to be a buyer with good credit, a low debt to income ratio, a healthy down payment, verifiable income, and looking to finance less than $417,000 (the cutoff for so-called jumbo loans).
Not particularly surprising. Sub-Prime has been a big problem so they’re only offering loans to A paper and Alt-A. Good time to buy if you’ve got the cash and the credit score. This winter or possibly next winter (2008-2009) will probably be the best in northern areas. Pick the slow season in 2008 for the rest of the country. That’s my prediction…we’ll start to stabilize in 2009 and might not see a total recovery for a few more years, but I think the bottom will come sooner rather than later.