What most people don't realize is that mortage companies to not have their own funds to loan to you as a mortgage. They have a "stable" of investors - private individuals, insurance companies, investment companies, etc. The "mortgage company" (more accurately, the mortgage broker) grants a mortgage and then has to go looking for someone to pay for it. More likely, they've already sought out that investor and the "terms and conditions" for qualifications are dictated by that investor NOT by your mortgage broker.
Mortgage investors are running scared right now and backing out on loans already promised and renegotiating as they can (legally) loans already in place.
That is why is it now so difficult to get a mortage loan.
We recently had a transaction delayed four days while the Buyer fought with their mortgage lender about being able to provide proof of the assets in their 401K. The 401K would not provide "hard copy" other than the quarterly statement they provide to every participant but the mortgage investor would not accept anything other than "hard copy", not even a print of the computer screen for the account!
With one or two MAJOR players declaring bankruptcy and with even foreign banks closing because of overinvestment in US mortgages, investors are even more scared
In the process of buying a home? Check your loan! What might have been there promised to you a week ago, may have disappeared! Literally!
Mortgage loans through banks such as B of A or Wells Fargo are secured with their banking assets and are not, at this point, at risk.
Saturday, August 11, 2007
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1 comments:
Getting a mortgage has become even more difficult in the current economic climate due to rates sky-rocketing. On a side-note, does anyone have any information about mortgage bonds? Me and my partner are thinking about getting onto the property ladder and we don't full understand the process.
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