Condo Communities Hit by Mortgage Probs
Condominium communities traditionally charge community fees ranging from $25 to well over $200 p/month for maintenance, lawn work, and more. But according to today's Tennessean, condo associations are feeling the crunch caused by subprime loans because owners are unable to pay the monthly charges. As a result, they are dipping into reserve funds to pay for new roofs and other services offered by the associations.
Read about the problem in
the article here.
Labels: condos, mortgages
THIS IS HUGE! Five Grand (free) Available
One of my favorite lenders came to our meeting this morning to tell us about the "Welcome Home Program" his company is sponsoring. For a limited time (probably until mid-May or when the money runs out), down payment assistance up to $5,000 will be available for buyers. A buyer would, of course, still have a passable credit score and there are a couple more requirements:
- The borrower must owner occupy the home (no investors for renting)
- Homebuyer education required for first-time homebuyers
- A portion of the grant may have to be paid back if the home is sold or refinanced in the first five years (ask mortgage consultant for details) (the lender told us this was R.A.R.E.)
- The borrowers' annual household income cannot exceed $49,280
- The borrower must have an investment of at least $500 in the transaction (and up to $300 can be a "gift" from a family member)
- The $500 investment required is waived if the borrower is disabled
- First come, first served basis - extremely limited.
If you are one iota interested in this, pick up the phone and call immediately because the free five grand won't be around long. I can be reached at (615) 491-2161 and my office number is (615) 459-4040 (ask for Kathy T.).
Labels: mortgages
More About Late Mortgage Payments
After yesterday's announcement by Countrywide home loans, more information is coming about how late payments have hit a historical high. According to
MSNBC.com news:
The Mortgage Bankers Association, in its quarterly snapshot of the mortgage market released Tuesday, reported that the percentage of payments that were 30 or more days past due for all loans tracked jumped to 4.95 percent in the October-to-December quarter.That marked a sharp rise from the third-quarter’s delinquency rate of 4.67 percent and was the worst showing since the spring of 2003, when the late-payment rate climbed to 4.97 percent.
It appears that much of the cause is due to subprime loans - or that second loan needed to make it to a 100% loan (typically an 80-20 loan split between two lenders). One problem experienced by a friend of mine is that that second loan was an adjustable rate mortgage. After her two-year guarantee was up at a lower rate, the second mortgage jumped by over $200 p/month. When you're on a bare-bones (or bare-pantry in this case) budget already, that $200 becomes nearly impossible to pay. So people pay that first, more expensive mortgage and let the second slide for several weeks (until next payday) or month(s).
In my bigger economic picture (and let me stress that I'm NOT an economist), I worry that we are heading into a recession. Some more articles:
Subprime lendings next act
Weak housing market weighs on job growth
Will subprime mess ripple through economy?
Treasury: Subprime issues manageable
Freddie Mac refuses some subprime loans
More homes, fewer buyers
Subprime apocalypse? or not
New foreclosures at record high
So you see the lending industry is reeling, at least for subprime lenders.
Labels: lenders, mortgages
