Say goodbye to the specialized mortgage options

[moh malekpour]

http://www.chicagotribune.com/class...arney-credit-crunch-0504may04,0,5242942.story

Like a spreading infection, restrictions on credit are moving into new and more specialized niches of the mortgage market.

The latest to feel the pinch:

•Cash-out refinancings.

•Loans with anything less than full documentation of borrower income, credit and assets.

•Mortgages for certain second-home purchases.

•Investment loan applications for a buyer who owns at least three other rental properties.

•Mortgages to borrowers with scant information at the three national credit bureaus.

•Short-term construction loans that convert to permanent mortgages.

•Adjustable-rate mortgages where the first occurs within 60 months after closing

 

[Lloyd Bonafide]

Every day it seems like it becomes harder to qualify for a loan. That being said, there is nothing wrong with a bank wanting to verify that a buyer is likely to pay back their loan.

The unintended consequence of this is that the pool of buyers is being reduced, prices will be pushed lower, and there will be more foreclosures and more bank losses.

 

[Doug Smith SRA]

Sayonara NINJA Lending

It is more like Sayonara to Ninja lending...no income, no job and no assets..

There has been no slow down of credit card applications in my mail. I don't see the see credit card companies instituting the same precautions. I just got a letter congratulating me on my increase in credit to $15,000 on one card on which I don't even have an outstanding balance.

The crash of credit card debt is again the most predicted upcoming crash and yet no one is doing much about it.

The former serial re-finance crowd are out there running up their credit card debt. Thanks to them, the economy is humming along.

Does anyone write a check or pay cash for groceries anymore?

Doug