First Time Homebuyers

[The Buddy Love Show]

Good series from Newsday this week:

http://www.newsday.com/business/ny-bzmor0730,0,3236271.story?coll=ny-main-bigpix

Hard times for first-time homebuyers
With the mortgage industry reeling, rookie homebuyers struggle to qualify for loans

BY TAMI LUHBY
tami.luhby@newsday

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Second of two parts

It's gotten a lot tougher for first-time home buyers to secure a mortgage these days.


With the mortgage industry rocked by soaring delinquency and foreclosure rates, particularly in the subprime loans made to people with weaker credit, lenders have become a lot stricter about doling out the dough. They have tightened their credit standards, requiring higher down payments, better credit scores and more documentation on income and assets.

These higher hurdles hit first-time home buyers, who often struggle just to accumulate a down payment, particularly hard, experts said.

"Even six months ago, it was pretty easy to get almost anyone a mortgage," said Bethany Marten, founder of Baldwin-based Home Buyers' Resource Center, a buyers' agency, and Mortgage 1, 2, 3, a mortgage broker. "In the past, really marginal buyers could get mortgages. But we have a lot of people we can't do loans for right now."

Until earlier this year, home buyers enjoyed more than a decade of easy credit, which helped fuel the housing frenzy. Lenders not only loosened their standards but also created so-called "exotic mortgages," which allowed people of lesser means and weaker credit to buy homes. Lenders offered mortgages requiring no down payment or carrying low initial interest rates for the first two to five years that made monthly payments affordable. Such mortgages made it possible for many first-timers to buy homes.

Now, a growing number of people are defaulting on those mortgages, particularly subprime ones made to people with blemished credit histories. As a result, lenders are pulling back on their offerings. In the past two weeks, for instance, several have said they are eliminating so-called 2/28 loans, which are usually subprime loans that have a lower fixed rate for the first two years before jumping to a higher adjustable rate.

Also, federal and state regulators are cracking down on lenders, saying they should take into account not only the borrowers' ability to handle the monthly payments during the teaser rate but also when that rate expires and the payments grow.

Lenders said this practice will cut many people -- including a lot of first-time home buyers -- out of the market.

"It will preclude millions from buying homes," said John Robbins, chairman of the Mortgage Bankers Association. Already "the industry is making the most conservative loans that it has in 10 years."

Lack big down payment

Today's first-time home buyers face many hurdles, experts said. Most of the ones whom Marten sees have saved less than $20,000 for a down payment, which may sound substantial but is typically less than 5 percent of a home's price, she said. On Long Island, the median home price is roughly $445,000. Also, many have poorly managed credit or a lack of credit, so their FICO credit scores are 600 or below (out of a possible 850), said Marten, whose clientele is about 75 percent first-timers.

Until the tightening, Marten could find a lender for those with relatively poor credit or with little for a down payment or with scant income documentation. She could secure a mortgage for people with credit scores of 620 but with no proof of income or with small, if any, down payments. She could get loans for clients who needed 100 percent financing but did not have the best credit history.

She turned away maybe 5 percent of applicants.

No more. Now, she said, she tells about one-third of applicants that they aren't going to qualify.

Loan officers are now being more stringent even when it comes to getting prime mortgages, which carry lower interest rates and are offered to people with stronger financial records, said Marianne Garvin, president of the Centereach-based Community Development Corp. of Long Island, which assists first-time home buyers in securing a loan. They are looking for credit scores of at least 660, up from 600 a few months ago.

"They want to see a stronger credit profile to get a conventional mortgage," Garvin said.

Before he could get approved for a mortgage and enter a lottery for a CDC affordable housing development in Mattituck, Russell Smith said, he knew he had to improve his credit profile, which was about 600. So he pulled his credit reports last year, found some mistakes and cleared them up. He also caught up with payments on his student loans and took care of some outstanding debts. Finally, he raised his score to the high 600s -- and got approval for a loan through a U.S. Department of Agriculture home financing program. He's getting a 33-year fixed rate mortgage at 5.75 percent.

"They kept saying you need to do this and need to do that. I kept going back and forth," Smith said. "But when they told me I was approved, it was all worth it."

Lenders like to see savingsIn addition to better credit backgrounds, lenders want to see that applicants have money in the bank and are lowering their debt burdens.

Some, for instance, require that less than 40 percent of a borrower's gross monthly income would go to debt payments, which includes the mortgage, as well as car, student loan and credit card payments, said Lynn Law, director of education and counseling at the Hauppauge-based Long Island Housing Partnership, which provides homeownership counseling. Previously, some lenders would have accepted a figure as high as 50 percent.


Also, some lenders want borrowers to have funds on hand -- in bank accounts, retirement accounts and investments -- to cover at least six months of expenses.

As for the down payment, the requirements can vary widely, experts said. Those with credit scores in the 700s and good incomes, as well as a healthy reserve fund, could secure 100 percent financing. Other borrowers may have to pay 3 percent down or 5 percent down, depending on their financial backgrounds.

Of course, first-time buyers with clean credit backgrounds and money in the bank can still secure a mortgage fairly easily.

Good credit scores pay off

Keith and Nicole Herrador moved into their Lindenhurst home in mid-June after renting a one-bedroom apartment in Brooklyn Heights. They had spent the past two years saving for a down payment and eventually accumulated nearly 10 percent. But they didn't have to worry about their credit scores, which were in the 700s, because they always paid their bills on time and never carried balances on their credit cards.

"Between looking at our credit scores and how much cash we had in reserve, we felt pretty confident we'd be approved for a mortgage," said Herrador, 29, a human resources manager in Manhattan.

And they were. The couple landed a 30-year fixed mortgage with a 6.375 interest rate.

Those who don't have such strong financial records may have to delay their dream until they pay off some debts and build up more savings, experts said."We've had to learn to say no if the credit really needs work. Not now, later," Law said. "If I see a credit score in the 500s, I think this person should wait."

That's exactly what Michelle Grant of Rosedale is doing. She and her fiance, Kenneth Goffe, want to buy a home in the Rosedale or Laurelton area of Queens, but they wouldn't be able to get a good interest rate if they applied now because of their financial backgrounds.

So they went through the CDC's first-time home buyers program to learn what they needed to do to better their chances of getting a prime mortgage.

Grant, who works as an equity research analyst at Standpoint Research in Forest Hills and as a personal trainer, is focusing on curtailing her spending, while her fiance is paying down his debts to improve his credit score, now in the mid-500s.

"I want to do the things I need to do to secure the best rate possible," said Grant, 32.

[Chuck P]

This was a good read, I know here in Illinois the homebuying market has almost come to a screeching holt. I'm in the processs of trying to sell my home and it is very slow.

One of my guys is trying to get pre-approved this week and I hope he does cause me and the wife have found the crib we want. My mortgage consultant was telling us that the median credit score to acquire a home used to be 580 now they want it to be 620 and that has taken a toll on the entire market here.

Can't wait to get my joint sold so we can move into something bigger.

[Tim Martinez]

We came in a very good time to buy our first home. Wifey and I followed the outline below.

Have individual fico scores above 700
30/70% debt to credit ratio
4-5 months of expenses funds in bank "seasoned".
Letter of Explanation for any "hiccups" in credit report.

We received 100% financing with a 30 yr fix @6% through Wells Fargo.

If you live in California and are planning to be a first time buyer, be sure to check out the CAL-HFA program.

http://www.calhfa.ca.gov/

[Edith A. Giles]

Looking at the article, I see I'm gonna have to step my game up...

[Mr.I]

The housing market has really SLOWED down. Buddy of mine has been trying to sell his house for over 6 months now, peeps just aint buying like they were a couple of years ago.

[Chuck P]

forclosure's in my county are at an all time high, predatory type lending was a big cause for this along with those damn ARM's, people got in those and started messing up their credit and couldn't get re-financed out of them

[liL Ray]

now that Newsday has posted this, maybe folks will now believe I know of what I talk about.

I think I even have a post in the archieves over a year or more telling first time homebuyers (FTHBs) to buy now.

well, the deal is, if you a FTHB and looking to buy, make sure you have over a 660 score, have 5-10% of the purchase price for downpayment + 3 months PITIT (some banks want 4 mths) + closing costs (or make sure you have a 6% sellers concession)...this is across the country...there is more to it than that, but if you have the above, you will be in the home you want.

[Chuck P]

Ray, first time homebuyers will be lucky to have closing cost money and for the most part you can forget about that 660 MEDIAN score.

Most companies here in Illinois use your middle score and 660 for a middle score is high.

The game has changed and the market is feeling the effects of that change.

[liL Ray]

Ray, first time homebuyers will be lucky to have closing cost money and for the most part you can forget about that 660 MEDIAN score.

Most companies here in Illinois use your middle score and 660 for a middle score is high.

The game has changed and the market is feeling the effects of that change.
you telling me?

I know this...I live this everyday...it is my career.

but the good thing about this great USA, there is always business and always folks who fall in the parameters that I laid out, so business is out there...it's just that now, not every dumb ass can do this business like before...this time, and this climate, is shaking out all the non-professionals and the fly by nigh,t so-called, sales people from this industry...

The time is tough, but it too shall pass.

[liL Ray]

We came in a very good time to buy our first home. Wifey and I followed the outline below.

Have individual fico scores above 700
30/70% debt to credit ratio
4-5 months of expenses funds in bank "seasoned".
Letter of Explanation for any "hiccups" in credit report.

We received 100% financing with a 30 yr fix @6% through Wells Fargo.

If you live in California and are planning to be a first time buyer, be sure to check out the CAL-HFA program.

http://www.calhfa.ca.gov/heah Tim, how was the closing..was it what I said...at 6%, I see everything worked out really well.

[Chuck P]

The couple who makes 12 dollars an hour apiece looking for their first home is in the rearview mirror. They will not be able to get financed under the current paradign and it's sad.

[mhd]

The couple who makes 12 dollars an hour apiece looking for their first home is in the rearview mirror. They will not be able to get financed under the current paradign and it's sad.

not true

[liL Ray]

The couple who makes 12 dollars an hour apiece looking for their first home is in the rearview mirror. They will not be able to get financed under the current paradign and it's sad.

Chuck, stick to dj'ing and leave the home financing to the professionals.

[Chuck P]

not true

The reason I say this is because in most cases this couple that I described won't have the credit score under the current paradign to get a mortgage.

If I'm wrong, school me

[Chuck P]

Chuck, stick to dj'ing and leave the home financing to the professionals.

Ray, I actually have my Real Estate License, I have not used them in some time but I'm still active

[liL Ray]

Ray, I actually have my Real Estate License, I have not used them in some time but I'm still activeand I don't do real estate...I get the money for folks to buy their real estate...

like I said, stick to them tables...lol

[The Buddy Love Show]

Chuck

You are talking about a couple earning $960/week before taxes

other factors like geographical location, home price, credit score, savings, debt ratio all play a role in the process. Your statement was too broad to be meaningful

[Chuck P]

and I don't do real estate...I get the money for folks to buy their real estate...

like I said, stick to them tables...lol

Get me a loan then dammit..........LOL

Seriously, when I get the details of my next mortgage, Imma let you know and tell me if we're getting a decent deal if you can........

[Chuck P]

Chuck

You are talking about a couple earning $960/week before taxes

other factors like geographical location, home price, credit score, savings, debt ratio all play a role in the process. Your statement was too broad to be meaningful

Thats true, I was thinking about cats who live in my area, I forget sometimes that you all are all over the country.

I agree with ya......

[Chris Conrad]

The reason I say this is because in most cases this couple that I described won't have the credit score under the current paradign to get a mortgage.

If I'm wrong, school me

i know people who make that much and their score is much higher...

[The Buddy Love Show]

Thats true, I was thinking about cats who live in my area, I forget sometimes that you all are all over the country.

I agree with ya......

i get caught up in that thought pattern as well.

I was in Philly yesterday and this woman was showing me this 4 bedroom row house she is rehabbing - Purchase price $16K..and no huge capital outlays for the rehab

I almost swallowed my fucking tongue

peace

[mhd]

Get me a loan then dammit..........LOL

Seriously, when I get the details of my next mortgage, Imma let you know and tell me if we're getting a decent deal if you can........

why on earth would he do that when you can do business directly with him? jes sayin

[liL Ray]

The reason I say this is because in most cases this couple that I described won't have the credit score under the current paradign to get a mortgage.

If I'm wrong, school methere are too many circumstances that prove the above incorrect.

I have seen folks in forclosure, who still have scores in the 600s and I have seen folks who make very little funds that have 700 scores.

The main thing that drives this housing market is still credit...now, one need to start to know the credit game and what will raise yor score.

Now, without fully reading the article above, for first time homebuyers, you need at least 3 to 5 open, active credit lines, with 2 or more having a 5K limit or more...Some banks also need for you to have at least one of these accounts open for 24months...

in layman's term, it doesn't matter how much you are earning, you need to have credit someplace. You need to open that account at Sears, at the gas station, with AMEX (which is not necessarily the best "credit" account), with Visa...now here is the "trick": DO NOT MAX OUT YOUR CARD and DO NOT CARRY A $0 BALANCE!!

also, when you get these accounts, and you are paying them on time, after 3 or 6 months, call customer service and ask them to raise your limit above $5,000. Again, this does not mean it is "your birthday" and it's time for celebration and a new dress for you or your wife(heehee)...

so, the person making $8 an hour with good credit and some money to put down, I can get them in a house all day, every day with my eyse close....but a person with no credit and make 6 figures, and no money to put down, I really can't help.

hope that answered your question, but this was more for those lurkers who maybe reading and maybe thinking of buying a home soon.

[mhd]

i get caught up in that thought pattern as well.

I was in Philly yesterday and this woman was showing me this 4 bedroom row house she is rehabbing - Purchase price $16K..and no huge capital outlays for the rehab

I almost swallowed my fucking tongue

peace

philly is ridiculously cheap, cheaper even than chicago, which makes chuck's statement even more absurd

[liL Ray]

Get me a loan then dammit..........LOL

Seriously, when I get the details of my next mortgage, Imma let you know and tell me if we're getting a decent deal if you can........I'll take a look, but so can folks in your area. What I am talking about is nationwide.

[MYOR]

i know people who make that much and their score is much higher...
Your score depends on how you manage your money..Not how much you make..

[Chris Conrad]

Your score depends on how you manage your money..Not how much you make..

i know that! i as just saying that you can make very little but have a high score...

[MYOR]

i know that! i as just saying that you can make very little but have a high score...

I'm agreeing with you...silly

[liL Ray]

there are too many circumstances that prove the above incorrect.

I have seen folks in forclosure, who still have scores in the 600s and I have seen folks who make very little funds that have 700 scores.

The main thing that drives this housing market is still credit...now, one need to start to know the credit game and what will raise yor score.

Now, without fully reading the article above, for first time homebuyers, you need at least 3 to 5 open, active credit lines, with 2 or more having a 5K limit or more...Some banks also need for you to have at least one of these accounts open for 24months...

in layman's term, it doesn't matter how much you are earning, you need to have credit someplace. You need to open that account at Sears, at the gas station, with AMEX (which is not necessarily the best "credit" account), with Visa...now here is the "trick": DO NOT MAX OUT YOUR CARD and DO NOT CARRY A $0 BALANCE!!

also, when you get these accounts, and you are paying them on time, after 3 or 6 months, call customer service and ask them to raise your limit above $5,000. Again, this does not mean it is "your birthday" and it's time for celebration and a new dress for you or your wife(heehee)...

so, the person making $8 an hour with good credit and some money to put down, I can get them in a house all day, every day with my eyse close....but a person with no credit and make 6 figures, and no money to put down, I really can't help.

hope that answered your question, but this was more for those lurkers who maybe reading and maybe thinking of buying a home soon.

damn, I should be charging for this shit!!!

but seriously, for those buying property for the first time or even buying their second property, please get that credit, PITI reserves and downpayment together...the days of just waking up and saying "if those fucks next door can buy a house, so can I" is almost over...I say almost, because unless you are family or very close friends, I'm not pulling out the tricks of the trade to "bend the rules" to get anybody in a house they can't afford..

[liL Ray]

I'm agreeing with you...sillyhahaha, you too are funny.

[Mr.I]

What's sad is that there are a LOT of peeps who are forced into paying high ass rents, making someone else rich, because they can't get a loan because of past mistakes. Many live paycheck to paycheck, can't afford to save $$$ for closing costs,ect.

[Tim Martinez]

heah Tim, how was the closing..was it what I said...at 6%, I see everything worked out really well.

Hi Ray,

All went very smooth with funding, title and closing escrow...and yes, we locked the 6% for a 30 yr fix. Wifey and I had a grin ear to ear when we spent our first night in our brand new home. We just could'nt believe it...we were finally homeowners. Patron Anejo shots all night!!

I must admit that at one point, I started to second guess myself whether I should have done an I/O for 5 years, Invest the difference into an IRA or my 401K, then re-fi later. Well see how things go in the next year. I feel confident with the 30 yr fix for now.

The only part that was a bit "hairy" was when we were given a move in date, then at the last minute we were told that title was not recorded yet. The Property Manager let us in anyway since funding landed on a Friday and it was recorded that next Monday. Right now were still settling in with boxes here and there and me painting the walls. Wifey is putting things away and our son loves the pool and play area. The office/DJ room is still a project that I'm not going to touch until next week.

Ray, I appreciate all of your knowledge and sharing it with us on the board. We are lucky to have you on here.

[The Buddy Love Show]

philly is ridiculously cheap, cheaper even than chicago, which makes chuck's statement even more absurd


i almost want to say "black gentrification time???"...most folk i know can handle that kind of price quite easily

[Discogoddess]

I never get tired of these threads, so please keep the wisdom and perspective coming.

Ray and others with the info, what's the story with existing homebuyers looking to rent or sell their first property and buy their next primary residence? Can those with bruised credit do it? Can those without 10% down and/or 3-6 months PITI do it? Must they sell the first property (or show good rental income) before buying the second?

If the answer is "do your own research, damn!", then that's cool...just thought I'd ask here.

[liL Ray]

What's sad is that there are a LOT of peeps who are forced into paying high ass rents, making someone else rich, because they can't get a loan because of past mistakes. Many live paycheck to paycheck, can't afford to save $$$ for closing costs,ect.and your point is???

[The Buddy Love Show]

What's sad is that there are a LOT of peeps who are forced into paying high ass rents, making someone else rich, because they can't get a loan because of past mistakes. Many live paycheck to paycheck, can't afford to save $$$ for closing costs,ect.

and out of that paycheck, some folk choose to buy liquor and cigarettes, cable TV and also hit the club

if that first paycheck isnt enough get a second job

depends how bad a person wants a thing

[liL Ray]

Ray, I appreciate all of your knowledge and sharing it with us on the board. We are lucky to have you on here.thank you sir...and I am glad it went well and some of what I said helped you out...

no second guessing" a 6% fix rate is the best thing you did...you should go back and price the same loan now and see what the rate will be...you will be surprised....and since you started on your journey, most of the mortgage programs have changed...

very happy for you.

[Mr.I]

and your point is???

I think a lot of people lack credit education, not understanding "the game" and end up falling into financial traps - I had to be schooled, wish I bought my house YEARS earlier. Best thing I ever did financially

[Tim Martinez]

you will be surprised....and since you started on your journey, most of the mortgage programs have changed...




It has jumped to 6.625% on the 30yr fix in just 3 weeks. Thanks for the positive reinforcement on our decision.

[mhd]

I never get tired of these threads, so please keep the wisdom and perspective coming.

Ray and others with the info, what's the story with existing homebuyers looking to rent or sell their first property and buy their next primary residence? Can those with bruised credit do it? Can those without 10% down and/or 3-6 months PITI do it? Must they sell the first property (or show good rental income) before buying the second?

If the answer is "do your own research, damn!", then that's cool...just thought I'd ask here.

honestly, i know i sound like a broken record with this, but, the best advice i coudl give you is: call rom
having said that, what are you doing with the second home, primary residence or investment?

[Chuck P]

philly is ridiculously cheap, cheaper even than chicago, which makes chuck's statement even more absurd

Bruh you blasting me and I'm just saying if I'm wrong hip me to your position.......

[MYOR]

I think a lot of people lack credit education, not understanding "the game" and end up falling into financial traps - I had to be schooled, wish I bought my house YEARS earlier. Best thing I ever did financially
By now, hopefully you've found some money. So, the next logical question is where do you put it? Where do you put it so that it will make the most difference in your credit score, naturally, but also in your life?

This was on a Oprah Show I saw a few weeks back thought it would be good here:

You've already been given a plan for paying back your credit cards (http://www.oprah.com/money/debtdiet/steps/debtdiet_steps_03.jhtml). Sometimes though, those cards should not be your top priority. Here's why: You have two types of debts. Secured debts are those that have assets backing them up—they can be repossessed or taken back. They include your home and your cars. Unsecured debts are those with no assets backing them up. If you don't make a payment on your credit card, the bank is not going to come and take back the blue jeans you bought at the mall. It might make your life miserable to have a collector call you at all hours, but the credit card company is not going to take away your place to sleep or your transportation to work.
<LI class=bulletli>Your secured debts need to be at the top of your priority list. <LI class=bulletli>Debts for which your wages can be garnished. These include your student loans and any child support payments. If you don't satisfy these, your paycheck is at risk. <LI class=bulletli>Any services you need to continue using. If you are not paying your doctor bills, that particular doctor is not going to be willing to see you again, right? That's a problem if you're relying on that doctor for care for a chronic condition. <LI class=bulletli>Unsecured debts, like credit cards. Once you've satisfied all of these urgent debts, you can begin to really focus on making headway with your credit cards. Use Step 3 (http://www.oprah.com/money/debtdiet/steps/debtdiet_steps_03.jhtml) to get them paid off as fast as possible.
Family and friends. Hopefully your family and friends are the most understanding of your creditors. Confirm your commitment to repay the debts, but make them a lower priority and choose accounts that can improve your credit score first.

[Chuck P]

I never get tired of these threads, so please keep the wisdom and perspective coming.

Ray and others with the info, what's the story with existing homebuyers looking to rent or sell their first property and buy their next primary residence? Can those with bruised credit do it? Can those without 10% down and/or 3-6 months PITI do it? Must they sell the first property (or show good rental income) before buying the second?

If the answer is "do your own research, damn!", then that's cool...just thought I'd ask here.

This is where I am now, I'm trying to sell my home and get another, I don't want to rent my current home even though I could qualify for the additional mortgage without a problem, I just don't want to be a landlord and would rather sell what I currently own.

Problem is with it being so slow right now, all I can do is wait it out and in the mean time I'm letting some bad ass houses get past me........

[MYOR]

Working on your credit score is also an important part of this process. Why? The higher your credit score, the lower you can reduce the interest rates you're paying to all of your creditors—mortgage lenders, auto lenders, credit card companies. If you're in debt, then servicing those debts takes a big chunk out of your monthly nut. A high credit score can make that chunk as small as possible.

What is a credit score?
A credit score, sometimes referred to as a FICO score, is a numerical representation of the information in your credit report. FICO credit scores, which look a lot like SAT scores, range from about 300 (though it's rare to see one below 500) to more than 850 (equally rare). These scores pack a powerful punch. Last year, 25 billion credit decisions were made based on FICO scores alone. These weren't just decisions about whether you'd be approved for a new credit card but:


<LI class=bulletli>How much you can borrow <LI class=bulletli>What sort of interest rate you'll pay <LI class=bulletli>Whether you'll qualify for an increase in your credit line <LI class=bulletli>Whether you'll qualify to rent an apartment <LI class=bulletli>Whether you can get a cell phone <LI class=bulletli>Whether you'll qualify for a cash advance
Whether you'll actually get the credit card for which you're "pre-approved"
In other words, your score is a really powerful piece of information. And because what it really is, for lack of a better description, is a snapshot of your borrowing and bill-paying behavior over the previous 24 months, as time goes by you have the power to change it for the better.

35% of your score is based upon how well you pay your bills.

30% of your score is a measure of how much credit you have available to you and how much of that credit you're using.

10% is based on your search for new credit—how recently have you opened (or inquired about opening) new accounts?

10% is the composition of your file. What percentage of your file is bankcard debt and what percentage is installment debt?

15% is a measure of the length of your credit relationships. How long have you had the cards in your wallet?

http://www.oprah.com/money/debtdiet/steps/debtdiet_steps_07_b.jhtml

Lots of helpful advice so when you cant get a hold of lil ray.. :biggrin:

[Mr.I]

I know this couple that got married back in the 80's. Their families all chipped in and gave them a downpayment for a house. This was a HUGE relief for them just starting out, they were able to spend $$ on other things + save. Today they're livin LARGE - thanks to that boost. A kickstart is always nice.

[mhd]

Bruh you blasting me and I'm just saying if I'm wrong hip me to your position.......

not blasting you, but others have already spelled it out, making 50 k a year is enough paper for a crib, if folks are serious and savvy, shit is mad affordable in chicago, and even cheaper in philly and baltimore, both places a lot like da chi, trust, you could live like a king in bmore and make a whole lot more paper working in dc and commuting. so, 50k a year, saving up for a downpayment, solving credit issues, using credit wisely, paying down debt, getting a second job, move to an area where there are incentives to buy, like cash and tax abatement, getting involved with programs that help with cash and closing costs like NACA, getting savvy professionals on your side that know mortgage brokers, like ray, title companies, developers, wholesalers, distressed sellers, investors, etc, that will not only give you deals on conventional purchases but can give you one time only special arrangenments

[liL Ray]

I never get tired of these threads, so please keep the wisdom and perspective coming.

Ray and others with the info, what's the story with existing homebuyers looking to rent or sell their first property and buy their next primary residence? Can those with bruised credit do it? Can those without 10% down and/or 3-6 months PITI do it? Must they sell the first property (or show good rental income) before buying the second?

If the answer is "do your own research, damn!", then that's cool...just thought I'd ask here.
for nonFTHBs, the landscape is a little better...but not by much...the credit part that I mention (3-5 tradelines at least one being $5K and open for 24mths) is tossed out the window...but you still have to have good credit scores to get the loan to Value needed as well as the good rate needed. All other criterias still hold.

As far as do you have to sell your existing first, that is all up to you and can your DTI (Debt to Income) support the cost of the new and the existing old.

a few "tricks" if you are going to hold on to the fuirst and buy another:
1) If you want the best rates and the highest LTV (Loan To Value) on the new purchase, you are going to have to say you are going to live in the second house and keep the first as a rental....now you can use 75% to 90% of the rental (depending on the bank) to add to your income...this is one of the power of homeownership.

2) If you are moving from a single family residence (SFR) to another SFR, it is easier for the bank to believe you are going to use the new place as the primary residence. You may have to write a "Motivational letter" that will say that the house you are moving to is bigger, school district is bigger, neighborhood is better (moving from the 'hood to the suburbs).

-however- if you are moving from a SFR to a 2, 3, 4 family, it is going to be very difficult convincing the bank that the new home will be your primary, so, it will fall under Investment property, second home, or Non-Owner Occupied. This will make the rate higher, and you may only be able borrow 80 to 90% Loan to Value...

there is alot more things involved (obviously) but just know that sometimes showing on the app that you are keeping the first home, just so you can use the additional rental income, will allow you to get approve for that bigger second home...can you then afford it or need it? only you and your pockets and senses can answer that.

hope that helps...

[liL Ray]

I know this couple that got married back in the 80's. Their families all chipped in and gave them a downpayment for a house. This was a HUGE relief for them just starting out, they were able to spend $$ on other things + save. Today they're livin LARGE - thanks to that boost. A kickstart is always nice.
Mr. I, you have to either communicate better or add a little more than that to this here conversation. What your are saying is so very obvious to a 2 year old...I'm still waiting on your point or your input in this.

[liL Ray]

Working on your credit score is also an important part of this process. Why? The higher your credit score, the lower you can reduce the interest rates you're paying to all of your creditors—mortgage lenders, auto lenders, credit card companies. If you're in debt, then servicing those debts takes a big chunk out of your monthly nut. A high credit score can make that chunk as small as possible.

What is a credit score?
A credit score, sometimes referred to as a FICO score, is a numerical representation of the information in your credit report. FICO credit scores, which look a lot like SAT scores, range from about 300 (though it's rare to see one below 500) to more than 850 (equally rare). These scores pack a powerful punch. Last year, 25 billion credit decisions were made based on FICO scores alone. These weren't just decisions about whether you'd be approved for a new credit card but:


<LI class=bulletli>How much you can borrow <LI class=bulletli>What sort of interest rate you'll pay <LI class=bulletli>Whether you'll qualify for an increase in your credit line <LI class=bulletli>Whether you'll qualify to rent an apartment <LI class=bulletli>Whether you can get a cell phone <LI class=bulletli>Whether you'll qualify for a cash advance
Whether you'll actually get the credit card for which you're "pre-approved"
In other words, your score is a really powerful piece of information. And because what it really is, for lack of a better description, is a snapshot of your borrowing and bill-paying behavior over the previous 24 months, as time goes by you have the power to change it for the better.

35% of your score is based upon how well you pay your bills.

30% of your score is a measure of how much credit you have available to you and how much of that credit you're using.

10% is based on your search for new credit—how recently have you opened (or inquired about opening) new accounts?

10% is the composition of your file. What percentage of your file is bankcard debt and what percentage is installment debt?

15% is a measure of the length of your credit relationships. How long have you had the cards in your wallet?

http://www.oprah.com/money/debtdiet/steps/debtdiet_steps_07_b.jhtml

Lots of helpful advice so when you cant get a hold of lil ray.. :biggrin:

copy and paste is cheating....

hehehehehehehe

[Chuck P]

not blasting you, but others have already spelled it out, making 50 k a year is enough paper for a crib, if folks are serious and savvy, shit is mad affordable in chicago, and even cheaper in philly and baltimore, both places a lot like da chi, trust, you could live like a king in bmore and make a whole lot more paper working in dc and commuting. so, 50k a year, saving up for a downpayment, solving credit issues, using credit wisely, paying down debt, getting a second job, move to an area where there are incentives to buy, like cash and tax abatement, getting involved with programs that help with cash and closing costs like NACA, getting savvy professionals on your side that know mortgage brokers, like ray, title companies, developers, wholesalers, distressed sellers, investors, etc, that will not only give you deals on conventional purchases but can give you one time only special arrangenments

Ok, I get what you saying, I will say this though a lot of areas in the Chi are getting expensive with the development that going on all around the city.

Those three bedroom brick bungelow's that are all around the city that used to go for 90-95 thousand like in the Auburn/Gresham and Englewood areas are now in the 160's to low 200's depending on the block.

My aunt lives on 85th and Justine, she paid 90 stacks for her crib about 14yrs ago, now her house has almost doubled in value. Got another aunt that lives on 87th and Bishop she has been in her bungelow since 1974 she said they paid 55 thousand for it then it worth almost four times the amount now.

Chicago is getting expensive bruh, depending on where you at......

[mhd]

I know this couple that got married back in the 80's. Their families all chipped in and gave them a downpayment for a house. This was a HUGE relief for them just starting out, they were able to spend $$ on other things + save. Today they're livin LARGE - thanks to that boost. A kickstart is always nice.

i was waiting for you to write that they then refinanced the house and repayed the loan to the family and allowed another family member to buy a house, oh well...

[liL Ray]

i was waiting for you to write that they then refinanced the house and repayed the loan to the family and allowed another family member to buy a house, oh well...
you know...lol

[Discogoddess]

for nonFTHBs, the landscape is a little better...but not by much...the credit part that I mention (3-5 tradelines at least one being $5K and open for 24mths) is tossed out the window...but you still have to have good credit scores to get the loan to Value needed as well as the good rate needed. All other criterias still hold.

As far as do you have to sell your existing first, that is all up to you and can your DTI (Debt to Income) support the cost of the new and the existing old.

a few "tricks" if you are going to hold on to the fuirst and buy another:
1) If you want the best rates and the highest LTV (Loan To Value) on the new purchase, you are going to have to say you are going to live in the second house and keep the first as a rental....now you can use 75% to 90% of the rental (depending on the bank) to add to your income...this is one of the power of homeownership.

2) If you are moving from a single family residence (SFR) to another SFR, it is easier for the bank to believe you are going to use the new place as the primary residence. You may have to write a "Motivational letter" that will say that the house you are moving to is bigger, school district is bigger, neighborhood is better (moving from the 'hood to the suburbs).

-however- if you are moving from a SFR to a 2, 3, 4 family, it is going to be very difficult convincing the bank that the new home will be your primary, so, it will fall under Investment property, second home, or Non-Owner Occupied. This will make the rate higher, and you may only be able borrow 80 to 90% Loan to Value...

there is alot more things involved (obviously) but just know that sometimes showing on the app that you are keeping the first home, just so you can use the additional rental income, will allow you to get approve for that bigger second home...can you then afford it or need it? only you and your pockets and senses can answer that.

hope that helps...

Yes, this helps a LOT, Ray! Thanks. In my personal situation, we're leaning toward keeping the first property as a rental, given that the nabe is up and coming and getting hotter (on the purchase and rental sides). If and when we do move, it will be as you said...for a bigger home (from condo to SF), better school choices and to live closer to our family support system (= babysitters ;)).

mhd, I thought Rom was the go-to guy for real estate sales, not mortgages? At any rate, I just wanted some ballpark info for myself and a couple other friends in the same boat.

[Mr.I]

Mr. I, you have to either communicate better or add a little more than that to this here conversation. What your are saying is so very obvious to a 2 year old...I'm still waiting on your point or your input in this.

Well I never

http://www.holidayblogging.com/wp-content/uploads/baby-monkey.jpg

[mhd]

Yes, this helps a LOT, Ray! Thanks. In my personal situation, we're leaning toward keeping the first property as a rental, given that the nabe is up and coming and getting hotter (on the purchase and rental sides). If and when we do move, it will be as you said...for a bigger home (from condo to SF), better school choices and to live closer to our family support system (= babysitters ;)).

mhd, I thought Rom was the go-to guy for real estate sales, not mortgages? At any rate, I just wanted some ballpark info for myself and a couple other friends in the same boat.

lol, imo, rom is the go to guy, period. there are a lot of morons out there and then you meet someone that really knows the game well, good to hear that you are keeping your spot, smart move

[liL Ray]

Yes, this helps a LOT, Ray! Thanks. In my personal situation, we're leaning toward keeping the first property as a rental, given that the nabe is up and coming and getting hotter (on the purchase and rental sides). If and when we do move, it will be as you said...for a bigger home (from condo to SF), better school choices and to live closer to our family support system (= babysitters ;)).


now, you didn't hear this from me and I will deny, deny, deny...if the rents is your area is $1000 for you place, you will make sure the loan officer put $1500 to $1800 on the application or whatever is needed to "make-up" your monthly income...

just tricks of the trade....

[liL Ray]

Well I never

http://www.holidayblogging.com/wp-content/uploads/baby-monkey.jpg

hahahahaha...no harm on my part Mr. I, just letting you know that you can't just run in, say incomplete thoughts and run back to the dryer...

hahaha

[liL Ray]

there are a lot of morons out there and then you meet someone that really knows the game well,

this may need some clearing up...hmmmmm.

[Discogoddess]

...Chicago is getting expensive bruh, depending on where you at......


Definitely...even Englewood has seen astronomical jumps in home values (which is great for the folks who got in earlier, if they can keep up with the taxes).

Folk have to be extra, super, especially tight and careful to get access to the American dream of homebuying. Esp. in markets like Chicago, where what once was affordable for many is becoming less and less so. There are still ways to do it, but folks have to be really on it.

[mhd]

Ok, I get what you saying, I will say this though a lot of areas in the Chi are getting expensive with the development that going on all around the city.

Those three bedroom brick bungelow's that are all around the city that used to go for 90-95 thousand like in the Auburn/Gresham and Englewood areas are now in the 160's to low 200's depending on the block.

My aunt lives on 85th and Justine, she paid 90 stacks for her crib about 14yrs ago, now her house has almost doubled in value. Got another aunt that lives on 87th and Bishop she has been in her bungelow since 1974 she said they paid 55 thousand for it then it worth almost four times the amount now.

Chicago is getting expensive bruh, depending on where you at......

but as a seller, you are happy about appreciation, right? man, you would be schocked to find what you can get for 200k in baltimore or philly, shidd, for 150 you could be in a nice neighborhood next door to a university, with a rental unit in the basement paying half your mortgage. but getting back to the chi, what are you gonna do? where is your crib? could you hire a property management company to take some of the headache away and rent your joint out and make a net profit monthly?

[MYOR]

this may nee some clearing up...hmmmmm.

you are a moron.. No copying a paste see so I didnt cheat.. hahaha :tongueout:
j/k

[mhd]

this may need some clearing up...hmmmmm.

?

[liL Ray]

you are a moron.. No copying a paste see so I didnt cheat.. hahaha :tongueout:
j/k
ok, that's how I thought it read...

[Discogoddess]

now, you didn't hear this from me and I will deny, deny, deny...if the rents is your area is $1000 for you place, you will make sure the loan officer put $1500 to $1800 on the application or whatever is needed to "make-up" your monthly income...

just tricks of the trade....

Thanks...this is along the lines of what my mortgage broker told me back when we were considering buying my deceased grandparents' home. The good thing is, in the intervening time (two years), rents have increased such that we don't have to fudge, lol.

[MYOR]

ok, that's how I thought it read...

ohh damn, here I go again trying to get my preggo ass kicked...

[Discogoddess]

...could you hire a property management company to take some of the headache away and rent your joint out and make a net profit monthly?

Speaking of that, Chuck (or anyone in the Chicago area), if you are considering renting your current home, I can put you in touch with a professional who can handle that for you. PM if you're interested.

[mhd]

ok, that's how I thought it read...

huh? dude, i just plugged you twice in this thread

[liL Ray]

Thanks...this is along the lines of what my mortgage broker told me back when we were considering buying my deceased grandparents' home. The good thing is, in the intervening time (two years), rents have increased such that we don't have to fudge, lol.but my point is, fudge anyway. This is not the time or the profession to get all holy and churchy on a mofo.


(where is them damn smilies!!)

[liL Ray]

huh? dude, i just plugged you twice in this thread

hahahaha...I'm good....I just wanted to get a rise out of you...hahahaha...

[liL Ray]

Speaking of that, Chuck (or anyone in the Chicago area), if you are considering renting your current home, I can put you in touch with a professional who can handle that for you. PM if you're interested.
there you go!!

[Discogoddess]

but my point is, fudge anyway. This is not the time or the profession to get all holy and churchy on a mofo.


(where is them damn smilies!!)

Duly noted.

And....thanks again!

[mhd]

this may need some clearing up...hmmmmm.

ok, i get it, Rom is on the board, is a real estate professional, for some years now, is excellent at what he does and he is IN CHICAGO, as you know there is a lot of mortgage fraud all over so morons refers to them

[Fletch]

philly is ridiculously cheap, cheaper even than chicago, which makes chuck's statement even more absurd
Philly's population loss will probably make it cheaper.

Got friends who are in a Victorian-style house in Spruce Hill (Penn campus). I believe it's about 10 rooms plus the attic. They bought it in 2000. I don't believe they paid that much for it!

[Chuck P]

but as a seller, you are happy about appreciation, right? man, you would be schocked to find what you can get for 200k in baltimore or philly, shidd, for 150 you could be in a nice neighborhood next door to a university, with a rental unit in the basement paying half your mortgage. but getting back to the chi, what are you gonna do? where is your crib? could you hire a property management company to take some of the headache away and rent your joint out and make a net profit monthly?


My home is in Calumet City, the wife and I just found a home out in Monee that we like, ofcourse it's bigger than the one we're selling and of course it cost more but we're just not into the landlord thing right now.

Especially with me in school now, I can't afford to take any time away from that.

So we'd rather just sell and move on.......

One of my Frat brothers was telling me the same thing about the Dallas/Fortworth area, we are looking at a house in the low 300's he was like for that kind of money you could damn near buy a mansion down here.

It comes down to one thing.........Location, Location, Location......

[Discogoddess]

...So we'd rather just sell and move on.......

But in the meantime (which can be a looooonnnnngggg time in this market), why not rent it for 6-12 months? Or a rent-to-own (if that makes sense)? For a fee, you CAN get rid of the landlord headache.

[Chuck P]

But in the meantime (which can be a looooonnnnngggg time in this market), why not rent it for 6-12 months? Or a rent-to-own (if that makes sense)? For a fee, you CAN get rid of the landlord headache.

We currently have two people who are attempting to purchase our current home, one of which is working with the same mortgage person as we are. Once one of them gets pre-approved not pre-qualified, then we'll put a contract on the house in Monee that we like, we just don't want to be landlords.....

[liL Ray]

we just don't want to be landlords.....I feel yah...I'm the same way.

[Chuck P]

I feel yah...I'm the same way.

you hear stories on both sides of the equation, thats a 50/50 chance that I'm just not interested in.

To hell with Section 8 when tennants done put holes in your walls, scratched up your hard wood floors, messed up appliances and such, no thank you............

the risk is just not worth it.......

even heard that they send section 8 clients through classes that "teach" them how to live in your home, sounds like a scary notion that an adult has to go to class to learn not to tear your shit up........

[Fletch]

I feel yah...I'm the same way.

I don't know about Chicago, but in New York, being a landlord can be a headache, especially with all the tenant's rights.

And with the NY Court of Appeals recently ruling in favor of Section 8 tenants, it becomes super harder to get unruly Section 8 folk out (that's if you go the Section 8 route). That's in addition to all the other tenants rights in New York.

[Tim Martinez]

This is something that has been on my mind for awhile now. I would like to have multiple properties down the line.

Are there any multiple property owners on the board that can chime in to the ups and downs to being a landlord?

[liL Ray]

I don't know about Chicago, but in New York, being a landlord can be a headache, especially with all the tenant's rights.



you can't get them out...unless you know Luigi, Mario and couple guys name Genovese.

[Chuck P]

Chicago has the same type of situation when it comes to tennant rights and things like that.

Ray Ray nem don't pay rent in

Jan then they tell you they gonna double up in Feb, but in Feb they only have half of jan then in March you go and get a court day that is set for April. In April the judge gives them 30 days to move out which puts you into May. In May if they are not out you have to go back and get another court date which will most likely be in June. In June the judge will give them two weeks to vacate the premises or the Sheriff will put them out. Two weeks into June you notify the Sheriff that the tennants have not moved out, in early July the Sheriff will come and set they shit on the street, you have to sue to get your money......

half the damn year is gone and you have not gotten ANY of the rent on your property...........no thank you

[Discogoddess]

...re: avoiding landlord headaches. And I'm not trying to change anyone's mind, as everyone has to do what's best for them. I would like to point out that there are market-rate tenants, though. Section 8 renters aren't the whole ball (or even the majority) of wax.

The more I think about it, I think there's a huge market for prop mgmt services as homeowners sit and wait for someone to actually buy their spots. Hmmm...

[Chuck P]

...re: avoiding landlord headaches. And I'm not trying to change anyone's mind, as everyone has to do what's best for them. I would like to point out that there are market-rate tenants, though. Section 8 renters aren't the whole ball (or even the majority) of wax.

The more I think about it, I think there's a huge market for prop mgmt services as homeowners sit and wait for someone to actually buy their spots. Hmmm...

I don't know, the first thing that comes to mind when I think about someone who has the means to purchase but chooses to rent is why would you do that, I'm a little skeptical of those folks, at least with Section 8 you thinking that no matter what you'll be getting some of your money every month without any problem, only thing is some tennants will be beating your house up like Ike on Tina........

[Fletch]

I don't know about Chicago, but in New York, being a landlord can be a headache, especially with all the tenant's rights.

And with the NY Court of Appeals recently ruling in favor of Section 8 tenants, it becomes super harder to get unruly Section 8 folk out (that's if you go the Section 8 route). That's in addition to all the other tenants rights in New York.
Oh, yeah, the ruling said that once a landlord participates with a Section 8, he can't opt out of it.......Damn!

I'm sure their crying right now to Roberts, Scalia, Thomas, Alito.....

[mhd]

This is something that has been on my mind for awhile now. I would like to have multiple properties down the line.

Are there any multiple property owners on the board that can chime in to the ups and downs to being a landlord?

don't believe the hype, you don't see donald trump complaining, you got one piece of the american dream, now its time to get another, don't ever allow fear or lack of knowledge to stop your dream

[mhd]

I don't know, the first thing that comes to mind when I think about someone who has the means to purchase but chooses to rent is why would you do that, I'm a little skeptical of those folks, at least with Section 8 you thinking that no matter what you'll be getting some of your money every month without any problem, only thing is some tennants will be beating your house up like Ike on Tina........

the first thing that comes to my mind is net profit every month, and how do i find another property and do it again for another profit center until i have so many profit centers that i spend all of my time counting money, but thats just me, seriously, its not for the faint of heart, but screening your tenants and preparing your property accordingly is key

[The Buddy Love Show]

http://region.princeton.edu/printable/printable_issue_99.html

[Discogoddess]

I don't know, the first thing that comes to mind when I think about someone who has the means to purchase but chooses to rent is why would you do that, I'm a little skeptical of those folks, at least with Section 8 you thinking that no matter what you'll be getting some of your money every month without any problem, only thing is some tennants will be beating your house up like Ike on Tina........

I'm confused by this. I don't know about you, but I rented for years, both as a single person and as part of a married couple. "Having the means" is subjective, and while there will always be people who could otherwise choose to buy, they rent. In fact, right now, the rental market has strengthened to the point that rents have been rising (after years of taking a beating). I suspect that in this fuzzy housing market, this may continue for a bit.

On a related note, I wonder if rent-to-own will become bigger than it is-as those with bruised credit and/or former homeowners work to rebuild, and/or as potential FTHB try to find an "in" in a more restrictive lending environment.

As was said earlier, it all comes down to tenant screening and being prepared.

[liL Ray]

rent-to-own .
you know, as long as I could work, I have heard this term, see this term, but not once have I seen this work...I think if you put this on snopes.com it will come up as a myth.

In the mortgage industry, I only know Florida that actually have this on the books as a law and it is holy hell to use this and own your home.

[MYOR]

you know, as long as I could work, I have heard this term, see this term, but not once have I seen this work...I think if you put this on snopes.com it will come up as a myth.

In the mortgage industry, I only know Florida that actually have this on the books as a law and it is holy hell to use this and own your home.

I was gonna ask is this even real.. since like you I have alway heard this term but never met anyone that actually did this..

[Chris Conrad]

http://region.princeton.edu/printable/printable_issue_99.html

new jersey has become completely ridiculous and expensive to live in. they talk about what you posted all the time on a local radio station...lots of folks bailing out can't afford it..property taxes in some towns growing at crazy rates...

[Chris Conrad]

and PA, the poconos is full of idiots from jersey and nyc as well...my uncle just moved up there...and a growing suburban gang problem...they do their biz in gated communities...

[Discogoddess]

you know, as long as I could work, I have heard this term, see this term, but not once have I seen this work...I think if you put this on snopes.com it will come up as a myth.

In the mortgage industry, I only know Florida that actually have this on the books as a law and it is holy hell to use this and own your home.

Don't know too much about it, save seeing it advertised with some properties. From what I understand, a certain portion of the rent goes toward downpayment each month for a specific period of time (as layed out in whatever written agreement the renter and landlord sign). I'm unclear on what happens after that, but am interested to learn more about how it works.

[liL Ray]

Don't know too much about it, save seeing it advertised with some properties. From what I understand, a certain portion of the rent goes toward downpayment each month for a specific period of time (as layed out in whatever written agreement the renter and landlord sign). I'm unclear on what happens after that, but am interested to learn more about how it works.bottomline, it's a fucking myth....here is why, when it comes to actually getting the loan, the landlord actually has to show that an account was setup for this...then the person putting this money in the account has to keep track...then you have to show that money as adopwnpayment...and then..aand then..and then.and arrrrrrrrrrrrrrrrrggghhh!!!

get my drift?

[Discogoddess]

bottomline, it's a fucking myth....here is why, when it comes to actually getting the loan, the landlord actually has to show that an account was setup for this...then the person putting this money in the account has to keep track...then you have to show that money as adopwnpayment...and then..aand then..and then.and arrrrrrrrrrrrrrrrrggghhh!!!

get my drift?

Got it.

LOL @ your funny re: snopes.com.

[liL Ray]

new jersey has become completely ridiculous and expensive to live in. ..property taxes in some towns growing at crazy rates...in some towns??/ try, all township in NJ...I did the refi loan on a person living in Camden and the house was barely worth 200K and the property taxes was almost 1/2 of their mortgage payment.

NJ is ridiculous with the taxes and this is usually the thing that kills a deal...the other place higher is Westchester, with Long Island (Nassau and Suffolk) running a close 3rd.

it's crazy!

[Huey P. Freeman]

I don't know, the first thing that comes to mind when I think about someone who has the means to purchase but chooses to rent is why would you do that, I'm a little skeptical of those folks, at least with Section 8 you thinking that no matter what you'll be getting some of your money every month without any problem, only thing is some tennants will be beating your house up like Ike on Tina........That's a bit strange IMO for you to be skeptical of someone like that. I have the means to buy as I have very little debt and make decently large cheese but I haven't decided where I want to put down roots. That's why I rent. I just recently relocated to Peoria for work but I'm positive this isn't the place I want to be long term. Right now I'm debating buying here(only because it is dirt cheap to do so) but am renting.

[mhd]

That's a bit strange IMO for you to be skeptical of someone like that. I have the means to buy as I have very little debt and make decently large cheese but I haven't decided where I want to put down roots. That's why I rent. I just recently relocated to Peoria for work but I'm positive this isn't the place I want to be long term. Right now I'm debating buying here(only because it is dirt cheap to do so) but am renting.

very unfortunate stereotype

[Fletch]

For all those folk who said to me, "The Bronx....too many gangsters", just to let you know that the "afford gates" are closing quick!

[Huey P. Freeman]

For all those folk who said to me, "The Bronx....too many gangsters", just to let you know that the "afford gates" are closing quick!Man I just can't bring myself to live in a shitty neighborhood just so I can own something. Fuck that. I value peace and quiet and a drama free environment too much I guess.

[mhd]

Man I just can't bring myself to live in a shitty neighborhood just so I can own something. Fuck that. I value peace and quiet and a drama free environment too much I guess.

lol, another unfortunate stereotype

[Huey P. Freeman]

lol, another unfortunate stereotypeNot really. When I was looking in Chicago for something in my price range(I don't have the luxury of dual income) they were all in neighborhoods that I wouldn't want to live in. Hell even in the neighborhood I grew up in(which admittedly is on the rise but fucked up right now) the property was on the high end of what I wanted to spend. I know Chicago well enough to know where I would and would not live.

[mhd]

Not really. When I was looking in Chicago for something in my price range(I don't have the luxury of dual income) they were all in neighborhoods that I wouldn't want to live in. Hell even in the neighborhood I grew up in(which admittedly is on the rise but fucked up right now) the property was on the high end of what I wanted to spend. I know Chicago well enough to know where I would and would not live.

it reads like you were calling the bronx a shitty neighborhood

[Huey P. Freeman]

it reads like you were calling the bronx a shitty neighborhoodDidn't mean to. I know less than zero about the bronx.

[liL Ray]

this is why these convos need beers and face to face dialogue.

[Discogoddess]

...(I don't have the luxury of dual income)...

He said "luxury" and "dual income" in the same sentence...ha! :rofl:

[mhd]

Didn't mean to. I know less than zero about the bronx.


lol, thats what i thought, to each his own, but the best way to change blocks, neighborhoods, communities, is to be a part of the change, to take risks, to lead. if we wait until the community 'comes up' then you will be paying a higher price, a premium for somebody else's vision, somebody else's foresight, jes sayin

[Fletch]

Man I just can't bring myself to live in a shitty neighborhood just so I can own something. Fuck that. I value peace and quiet and a drama free environment too much I guess.

You'd be surprised to know that what is percieved as shitty may actually be peaceful, quiet and drama-free! I'm learning that with mine and a few other Bronx neighborhoods!

[Chris Conrad]

lol, thats what i thought, to each his own, but the best way to change blocks, neighborhoods, communities, is to be a part of the change, to take risks, to lead. if we wait until the community 'comes up' then you will be paying a higher price, a premium for somebody else's vision, somebody else's foresight, jes sayin

'be the change you want to see'

[Fletch]

Not really. When I was looking in Chicago for something in my price range(I don't have the luxury of dual income) they were all in neighborhoods that I wouldn't want to live in. Hell even in the neighborhood I grew up in(which admittedly is on the rise but fucked up right now) the property was on the high end of what I wanted to spend. I know Chicago well enough to know where I would and would not live.

Homebuyer's Number 1 rule.......BE OPEN!

[Huey P. Freeman]

He said "luxury" and "dual income" in the same sentence...ha! :rofl:I've been in a dual income situation before and financially it was a luxury. Combined purchase power.

[Discogoddess]

...Combined purchase power.

And, for many, that comes with double the living expenses and debt. That "two can live as cheaply as one" adage is bullshit, imho. But, I was really just being jokey re: my own experiences and observations.

[Huey P. Freeman]

Homebuyer's Number 1 rule.......BE OPEN!
I wish I could be. Once I was looking at a condo on my boys block in south shore. In my price range, rehabbed and very nice. While I'm in the place I literally hear 4 motherfuckers come by shaking the building with their sound systems. I come outside get in my car and drive to the end of the block where a motherfucker is standing in the middle of the street taking a piss. I said fuck that and never thought about that spot again. Some shit I just can't do.

[liL Ray]

That "two can live as cheaply as one" adage is bullshit, imho. .your opinion, but I ain't trading it in...not one bit! I'm hooked!

[Discogoddess]

...but I ain't trading it in...not one bit! I'm hooked!

Me too, but for reasons other than my bank balance. :wink:

[Fletch]

this is why these convos need beers and face to face dialogue.

Ray, etc.....FYI.....

Saw a two family house and garage on E. 32nd Street bet. Glenwood and H(the Junction)........$750,0000!!!!!!! My moms lives in the coop around the corner. Bought her unit 20 years ago! Now, I remember then, when them houses were going for $200,000. Now, with a Target Mall being built (Old parking lot on Flatbush and Ave H), them homes are now going off the chain!

Oh, yeah, taxes $2,000/yr!!!!!!!

[Huey P. Freeman]

your opinion, but I ain't trading it in...not one bit! I'm hooked!It depends on income and mindset IMO. Can two people who make 100K a year each live off of 100K and make moves with the rest? Certainly they can.

[mhd]

I wish I could be. Once I was looking at a condo on my boys block in south shore. In my price range, rehabbed and very nice. While I'm in the place I literally hear 4 motherfuckers come by shaking the building with their sound systems. I come outside get in my car and drive to the end of the block where a motherfucker is standing in the middle of the street taking a piss. I said fuck that and never thought about that spot again. Some shit I just can't do.


so who wins?

[mhd]

'be the change you want to see'

real simple

[liL Ray]

Ray, etc.....FYI.....

Saw a two family house and garage on E. 32nd Street bet. Glenwood and H(the Junction)........$750,0000!!!!!!! My moms lives in the coop around the corner. Bought her unit 20 years ago! Now, I remember then, when them houses were going for $200,000. Now, with a Target Mall being built (Old parking lot on Flatbush and Ave H), them homes are now going off the chain!

Oh, yeah, taxes $2,000/yr!!!!!!!nyc taxes are the best!!!!

yeah, I'm just holding on to mine and trying not to refi...in about 3-5years, I figure I should be taking a 250-300K profit then...see you in the Caribbean...

[Mr.I]

I wish I could be. Once I was looking at a condo on my boys block in south shore. In my price range, rehabbed and very nice. While I'm in the place I literally hear 4 motherfuckers come by shaking the building with their sound systems. I come outside get in my car and drive to the end of the block where a motherfucker is standing in the middle of the street taking a piss. I said fuck that and never thought about that spot again. Some shit I just can't do.

Damn, not exactly "shangrila" huh:biglaugha:

[The Buddy Love Show]

I wish I could be. Once I was looking at a condo on my boys block in south shore. In my price range, rehabbed and very nice. While I'm in the place I literally hear 4 motherfuckers come by shaking the building with their sound systems. I come outside get in my car and drive to the end of the block where a motherfucker is standing in the middle of the street taking a piss. I said fuck that and never thought about that spot again. Some shit I just can't do.

I respect this point of view...and in many respects i share it (if the price is wrong)

I will note that many folk who we deride as gentrifying nabes dont seem to share this view - i call em pioneers - and they cash in big when the neighborhood changes

[Fletch]

I wish I could be. Once I was looking at a condo on my boys block in south shore. In my price range, rehabbed and very nice. While I'm in the place I literally hear 4 motherfuckers come by shaking the building with their sound systems. I come outside get in my car and drive to the end of the block where a motherfucker is standing in the middle of the street taking a piss. I said fuck that and never thought about that spot again. Some shit I just can't do.

Huey,

Check my signature. There's a reason why I've had it for the past few months.

[liL Ray]

Damn, not exactly "shangrila" huh:biglaugha:

hahahahaha

[mhd]

I respect this point of view...and in many respects i share it (if the price is wrong)

I will note that many folk who we deride as gentrifying nabes dont seem to share this view - i call em pioneers - and they cash in big when the neighborhood changes

man, i see that shit and smile

[liL Ray]

ok, so how do I move this to the financial forum now?

[Fletch]

ok, so how do I move this to the financial forum now?

I think this should stay here, due to more peeps lurking in the general discussion section. But Gman, it's your call!

[The Buddy Love Show]

man, i see that shit and smile

imo, many of us are missing out on opportunities to revitalize nabes, make money and keep communities from tipping into despair by providing successful role models

on the other hand, if you've lived in sub-optimal nabes, after a while you want out at all cost - before you lose your marbles

[liL Ray]

on the other hand, if you've lived in sub-optimal nabes, after a while you want out at all cost - before you lose your marbles
ain't dat the truth...you can only take the Ice Cream truck on your block, blaring that damn ice cream truck song, at 1am, but so much!!! cleaning up condom wrappers and hosing down pissed stained sidewalk and buildings don't help either.

[Huey P. Freeman]

Huey,

Check my signature. There's a reason why I've had it for the past few months.I guess I'm not that idealistic.

[Fletch]

ain't dat the truth...you can only take the Ice Cream truck on your block, blaring that damn ice cream truck song, at 1am, but so much!!! cleaning up condom wrappers and hosing down pissed stained sidewalk and buildings don't help either.This past weekend, I was on E. 48th and Tilden at some friends house. A big party was going on at a home across the street. The friends tell me that there there are parties in the nabe every weekend. In fact, the Mrs "wants to get outta here".

I was in that neighborhood one Labor Day Weekend, and it was beyond bananas!

An effective homeowners association should be able to resolve the parties. Correct?

[liL Ray]

An effective homeowners association should be able to resolve the parties. Correct?
in a caribbean neighborhood??? hahahahahaahaha...

parties and Caribbean neighborhood goes hand in hand....I have no problems with the occassional parties in the summer time in my nabe...they should be happy their is no dice playing and the occasional pissing on the side of their building or the weed smoking.

Speaking of weed smoking, most of the folks I catch smoking the wacky tobaccy in my nabe are the 50+ white men parked in front on my house, to which I come out with phone in hand yelling "AHHHHHHHHH HELLLZ NAH you ain't doing what i think you are doing in front of my house!!!" and start to call the cops....the other thing I find is that cops come real quick in areas that use to be white...talk about reverse gentrification!!!

[mhd]

I guess I'm not that idealistic.

how is it idealistic to expect and prepare for opportunity?

[mhd]

imo, many of us are missing out on opportunities to revitalize nabes, make money and keep communities from tipping into despair by providing successful role models

on the other hand, if you've lived in sub-optimal nabes, after a while you want out at all cost - before you lose your marbles

it can be a win, win, win, win situation

[Huey P. Freeman]

how is it idealistic to expect and prepare for opportunity?That's not the idealistic part. Believing you can change a neighborhood just by being an example is. Being disturbed by pounding music and having people pissing in my streets was an opportunity I felt I should pass on.

[mhd]

Believing you can change a neighborhood just by being an example is "idealistic".

c'mon man, you gotta be kidding me, you don't believe that

[Huey P. Freeman]

c'mon man, you gotta be kidding me, you don't believe thatYes I do. I've seen it in action. Economics plays a far bigger part in changing a neighborhood than me being an example. Hell there were plenty of good examples in my neighborhood growing up and it was a far worse place when my grandmother died last year than when we moved there 28 years ago. It's changing now because the university is expanding it's reach. Changing the economics of the neighborhood.

[mhd]

Yes I do. I've seen it in action. Economics plays a far bigger part in changing a neighborhood than me being an example. Hell there were plenty of good examples in my neighborhood growing up and it was a far worse place when my grandmother died last year than when we moved there 28 years ago. It's changing now because the university is expanding it's reach. Changing the economics of the neighborhood.

as a homeowner in a changing neighborhood you are the economics, folks don't realize that by increasing home ownership you can completely change the surrounding area, U of C is changing the neighborhood by being an owner and selling to other owners and spurring encouraging development, how long do you think they will tolerate street pissing guy? btw, my peeps have been in your neighborhood since the 1950s, some are still there. and somebody is gonna take a stand and be the example and that guy is gonna sell to you or people like you and make 100k profit, and go to the "frontier" and do it again, develop an area where cats grew up but afraid to move back. in the chi, if i hear about one more cat moving to the south suburbs while the nabe they grew up in is blowing up i'll scream. sad part is, hood rats are moving out there too, so, you can run but you can't hide

[mhd]

btw, not you personally, just the mindset

[Huey P. Freeman]

as a homeowner in a changing neighborhood you are the economics, folks don't realize that by increasing home ownership you can completely change the surrounding area, U of C is changing the neighborhood by being an owner and selling to other owners and spurring encouraging development, how long do you think they will tolerate street pissing guy? btw, my peeps have been in your neighborhood since the 1950s, some are still there. and somebody is gonna take a stand and be the example and that guy is gonna sell to you or people like you and make 100k profit, and go to the "frontier" and do it again, develop an area where cats grew up but afraid to move back. in the chi, if i hear about one more cat moving to the south suburbs while the nabe they grew up in is blowing up i'll scream. sad part is, hood rats are moving out there too, so, you can run but you can't hideI get where you are coming from Mark, however, there has always been homeowners and good examples in my old neighborhood. Even with that it was in steady decline for almost 30 years. It took an investor with deep pockets(U of C in this case) to turn it around.

[Fletch]

Huey, take it from someone who moved from the most trendy neighborhood in New York City (15 years renting in Park Slope, Brooklyn) to a neighborhood in the Bronx (Parkchester). As a homeowner, you will not regret, in the long run, owning in even what is considered a borderline spot.

And take it from someone who's knowledgeable in urban studies....having a piece of property in any major American city is the best piece of **** you can have!

[Fletch]

...an interesting read! (http://www.nytimes.com/2007/07/29/realestate/29cov.html)

[The Buddy Love Show]

as a homeowner in a changing neighborhood you are the economics, folks don't realize that by increasing home ownership you can completely change the surrounding area, U of C is changing the neighborhood by being an owner and selling to other owners and spurring encouraging development, how long do you think they will tolerate street pissing guy? btw, my peeps have been in your neighborhood since the 1950s, some are still there. and somebody is gonna take a stand and be the example and that guy is gonna sell to you or people like you and make 100k profit, and go to the "frontier" and do it again, develop an area where cats grew up but afraid to move back. in the chi, if i hear about one more cat moving to the south suburbs while the nabe they grew up in is blowing up i'll scream. sad part is, hood rats are moving out there too, so, you can run but you can't hide

I have an 15 year old editorial cartoon from the NY TIMES...that depicts this scenario

and the last frame showed all of the suburban whites moving back into the cities so they can be in the hub of culture

i shit you not

the plan is not a secret

[MEP]

tight post!

[AK]

I have an 15 year old editorial cartoon from the NY TIMES...that depicts this scenario

and the last frame showed all of the suburban whites moving back into the cities so they can be in the hub of culture

i shit you not

the plan is not a secret

Precisely what's happening in many areas in Chicago.

[Fletch]

Oh, just remember,

You're first home's a starter!

[mhd]

...an interesting read! (http://www.nytimes.com/2007/07/29/realestate/29cov.html)

great, great article! here is the blueprint right there in black and white, respect!

[Discogoddess]

great, great article! here is the blueprint right there in black and white, respect!

Definitely! Thanks for sharing, Fletch.

[Fletch]

i almost want to say "black gentrification time???"...most folk i know can handle that kind of price quite easily
Yo, Willie,

What part of Philly is that property in?

I need a weekend spot for Penn Relays every April (although I can drive, train or bus back and forth to Philly).

[Fletch]

Definitely! Thanks for sharing, Fletch.

FYI....the Jewish girl in the red dress is living in an Ditmas Park, an area that used to be Jewish, and is now mostly Carribbean. Those victorian style buildings are absolutely georgeous, and the homes on Ocean Ave between Dorchester and Newkirk are huge, and very treelined.

In fact, I passed up a coop 13 years ago, on E. 19th between Dorchester and Cortelou, for $60,000. As the song goes, "What kind of fool am I"

[MYOR]

Fletch that is an article every first time homebuyer needs to print out and put on the fridge.. THANK YOU:thumbsup::thumbsup:

[The Buddy Love Show]

Yo, Willie,

What part of Philly is that property in?

I need a weekend spot for Penn Relays every April (although I can drive, train or bus back and forth to Philly).

The FUCKED UP part

the area brought back memories of bushwick 1975.....

seriously, didnt know the area...all row houses..i'll ask and get back atcha

[Fletch]

The FUCKED UP part

the area brought back memories of bushwick 1975.....

seriously, didnt know the area...all row houses..i'll ask and get back atcha

Bushwick '75 eh? Must be North or West! But 16K is like a freekin' student loan, although renovations will be no joke!

Those Philly row houses, in renovated form, is the prettiest ****s you can have. (See Spruce Hill, Penn campus area).

[mhd]

Bushwick '75 eh? Must be North or West! But 16K is like a freekin' student loan, although renovations will be no joke!

Those Philly row houses, in renovated form, is the prettiest ****s you can have. (See Spruce Hill, Penn campus area).

trust, you prolly don't have to spend a bundle to get it ready for that area

[The Buddy Love Show]

trust, you prolly don't have to spend a bundle to get it ready for that area

LOL!!!!

U obviously KNOW whats up

[Fletch]

Whassup with the HSBC motto, "We cut the closing costs, you cut the grass"? Anyone got a loan from them?

[The Buddy Love Show]

Whassup with the HSBC motto, "We cut the closing costs, you cut the grass"? Anyone got a loan from them?

i used their mortgage service. i was satisfied.

[mhd]

I get where you are coming from Mark, however, there has always been homeowners and good examples in my old neighborhood. Even with that it was in steady decline for almost 30 years. It took an investor with deep pockets(U of C in this case) to turn it around.

coupla points on that, gangs and crack sent that community downhill, and it was a terrible shame because it was an great haven for working class and middle class aspirants to raise families, funny though, the advent of gangs came just as the civil rights movement made social/upward mobility a reality, so as gangs took hold those that could afford to left the neighborhood, and taking many, but certainly not all of the positive role models, yet left those good folks, like your grandmother, in a living hell. fast forward, when development started to occur would have been a good time to buy even as it was still a little rough, because even though University of Chicago was a deep pocket player, Development in that area was gonna happen regardless of the university, just as it happened all over urban america!!!!

[Ayo]

American Home Mortgage reported today that they were unable to fund approximately $350 million in new mortgages yesterday and expected to fail to fund between $450 million and $500 million in new loans today.

That means that borrowers who expected to receive funds for purchase and refinance transactions from American Home Mortgage probably will not.

[liL Ray]

American Home Mortgage reported today that they were unable to fund approximately $350 million in new mortgages yesterday and expected to fail to fund between $450 million and $500 million in new loans today.

That means that borrowers who expected to receive funds for purchase and refinance transactions from American Home Mortgage probably will not.
damn...thank God I have no files with them...

this is bad.

[liL Ray]

American Home Mortgage reported today that they were unable to fund approximately $350 million in new mortgages yesterday and expected to fail to fund between $450 million and $500 million in new loans today.

That means that borrowers who expected to receive funds for purchase and refinance transactions from American Home Mortgage probably will not.
did some research, it is actually ABC - American Broker Conduit...you should see the fall out on my industry message board about this....

the f'ed up thing is not the refi's, but can imagine the purchases...you are set to close on your dream home today, and the company won't close and fund your deal...now, you already told your landlord "FUCKYOUBIATCH" and have all your stuff packed in a truck...where you gonna sleep tonite???

damn...

see my other board for comments:

http://forum.brokeroutpost.com/loans/forum/2/147343.htm

this right here fucks you up

We have a loan with ABC that was SUPPOSED to fund yesterday and the wire never got to the title company. We called ABC last night after being on hold for almost an hour a lady from the funding department got on the phone. She said she did not know if the loan was going to fund because she didn't even know if she would have a job tommorrow!!!! She then asked if we could say a prayer for her. It really is a sad situation for the company and everyone who has loans with them that are supposed to fund.

[Fletch]

did some research, it is actually ABC - American Broker Conduit...you should see the fall out on my industry message board about this....

the f'ed up thing is not the refi's, but can imagine the purchases...you are set to close on your dream home today, and the company won't close and fund your deal...now, you already told your landlord "FUCKYOUBIATCH" and have all your stuff packed in a truck...where you gonna sleep tonite???

damn...

see my other board for comments:

http://forum.brokeroutpost.com/loans/forum/2/147343.htm

this right here fucks you up

We have a loan with ABC that was SUPPOSED to fund yesterday and the wire never got to the title company. We called ABC last night after being on hold for almost an hour a lady from the funding department got on the phone. She said she did not know if the loan was going to fund because she didn't even know if she would have a job tommorrow!!!! She then asked if we could say a prayer for her. It really is a sad situation for the company and everyone who has loans with them that are supposed to fund.
And that, my friends, is why I timed my moving 30 days after closing!

Time for Congress to propose and pass the Mortgage Bailout Act....but it has other things on its mind!

Oh, yeah, would giving more than 48 hours notice for closing make sense? That way, everyone involved can prepare "in case shit happens"!

And how 'bout mandatory disclosure of a lender's financial status?

[Huey P. Freeman]

coupla points on that, gangs and crack sent that community downhill, and it was a terrible shame because it was an great haven for working class and middle class aspirants to raise families, funny though, the advent of gangs came just as the civil rights movement made social/upward mobility a reality, so as gangs took hold those that could afford to left the neighborhood, and taking many, but certainly not all of the positive role models, yet left those good folks, like your grandmother, in a living hell. fast forward, when development started to occur would have been a good time to buy even as it was still a little rough, because even though University of Chicago was a deep pocket player, Development in that area was gonna happen regardless of the university, just as it happened all over urban america!!!!I feel you, however, my dad got robbed by gunpoint 3 times in 2 years in that hood. Somes shit just ain't worth it.

[Huey P. Freeman]

coupla points on that, gangs and crack sent that community downhill, and it was a terrible shame because it was an great haven for working class and middle class aspirants to raise families, funny though, the advent of gangs came just as the civil rights movement made social/upward mobility a reality, so as gangs took hold those that could afford to left the neighborhood, and taking many, but certainly not all of the positive role models, yet left those good folks, like your grandmother, in a living hell. fast forward, when development started to occur would have been a good time to buy even as it was still a little rough, because even though University of Chicago was a deep pocket player, Development in that area was gonna happen regardless of the university, just as it happened all over urban america!!!!Just wanted to add that the original point, that the real change came(comes) through economic factors, is reinforced by your post. In the end that's what is transformed the neighborhood to shit and is what is transforming it back.

[Fletch]

I feel you, however, my dad got robbed by gunpoint 3 times in 2 years in that hood. Somes shit just ain't worth it.

Huey, I totally understand not buying property in ultra-rough areas. But have you thought about buying in that area as an investment? I know you have to rent out to a tenant, and assume the responsibilities of a landlord. But have you ever thought of that option? I know, I myself shy away from tenants, but if the purpose is to get into the market, and to not want to live in the area you're buying in......

[MYOR]

People lift their noses up at their neighborhood when it's bad.. "I would NEVER buy here" Then curse it when they are being forced out by high rents..

[Huey P. Freeman]

Huey, I totally understand not buying property in ultra-rough areas. But have you thought about buying in that area as an investment? I know you have to rent out to a tenant, and assume the responsibilities of a landlord. But have you ever thought of that option? I know, I myself shy away from tenants, but if the purpose is to get into the market, and to not want to live in the area you're buying in......Not too keen on having tenants. Also as a first time buyer don't I have to live at the property(at least for a period of time)?

[Leslie]

C-Bass, Sowood.

[Ayo]

Hey Ray, it was American Home Mortgage...Here is the CNN article:

American Home Mortgage's survival in doubt
Shares crumble 90% after troubled prime mortgage lender said it may liquidate, retains investment banks to help it consider options.
July 31 2007: 5:03 PM EDT

NEW YORK (Reuters) -- American Home Mortgage Investment Corp. said on Tuesday it can no longer fund home loans and may liquidate assets, putting its survival in doubt and sending its shares plummeting 90 percent.

The large U.S. mortgage provider and real estate investment trust said its lenders cut off access to credit, leaving it without cash on Monday to fund $300 million of loans it had agreed to make.

The dream of home ownership has become a nightmare for millions of Americans. CNN's Bill Tucker explains. (April 3)
Play video

It also expected to be unable to fund $450 million to $500 million of loans on Tuesday.

Melville, New York-based American Home (Charts) hired Milestone Advisors and Lazard to help evaluate options and advise on "the sourcing of additional liquidity, including the orderly liquidation of its assets."

With the developments, worries about credit quality and homeowner defaults have spread beyond subprime lenders, which lend to people with weaker credit, to lenders that make higher-quality loans.

American Home offers "Alt-A" mortgages, which fall between prime and subprime in quality, and recently held a roughly 2.5 percent share of the U.S. mortgage market.

"The chances are pretty high that the company either goes bankrupt or materially restructures, leaving little value for shareholders," said Bose George, an analyst at Keefe Bruyette & Woods Inc. in New York.
Prime borrowers catching subprime ills

"The business model of non-bank, mortgage lenders is challenging, and may be unstable, because they are so dependent on the willingness of the capital markets to fund operations," he added.

Mary Feder, a spokeswoman for American Home, did not respond to an e-mail seeking comment. Her telephone mailbox did not accept messages.

American Home did not return calls on Monday, after it delayed paying a scheduled common stock dividend and announced "major" writedowns.

American Home shares closed down $9.43 at $1.04 on the New York Stock Exchange Tuesday. They traded as high as $36.36 last Dec. 6.
Margin calls

Many U.S. mortgage providers have struggled with a housing slump that has caused home prices to stall, borrowing costs to rise and defaults to soar. Dozens have tightened lending policies, quit the industry, or gone bankrupt.

American Home relies on bank financing to help fund home loans.

In its statement, American Home said it could not borrow from its credit lines and had "substantial" unpaid margin calls pending to lenders, even after meeting "very significant" calls in the last three weeks.

According to its most recent quarterly report, American Home had obtained financing from several lenders. Among them were Bank of America Corp. (Charts, Fortune 500), Bear Stearns Cos. Inc. (Charts, Fortune 500), Credit Agricole SA's Calyon affiliate and UBS AG. None immediately returned calls seeking comment.

If it sought bankruptcy protection, American Home would join New Century Financial Corp. and several other home lenders in seeking protection from creditors this year.

Most of those lenders, however, catered to subprime borrowers, rather than borrowers considered better credit risks.

More traditional lenders, such as Countrywide Financial (Charts, Fortune 500), and banks, such as Wachovia (Charts, Fortune 500) and Wells Fargo (Charts, Fortune 500), have been hurt by weakness in the housing market caused in part by subprime loans.

[liL Ray]

And that, my friends, is why I timed my moving 30 days after closing!

Time for Congress to propose and pass the Mortgage Bailout Act....but it has other things on its mind!

Oh, yeah, would giving more than 48 hours notice for closing make sense? That way, everyone involved can prepare "in case shit happens"!

And how 'bout mandatory disclosure of a lender's financial status?I will deal with this in the morning....

[liL Ray]

Hey Ray, it was American Home Mortgage... .thanks for the heads up...

[GroovMaster]

i didn't have a problem...i'm not braggin' but i was pre-approved by 4 different lenders before i looked at a new house

perks: i work in new construction as a quality control inspector...so i got a good deal (thank you god)

[liL Ray]

i didn't have a problem...i'm not braggin' but i was pre-approved by 4 different lenders before i looked at a new house

perks: i work in new construction as a quality control inspector...so i got a good deal (thank you god)

the pre-approval letter means nothing...I write them everyday....there is more to the process than that...trust.

[liL Ray]

And that, my friends, is why I timed my moving 30 days after closing!

Time for Congress to propose and pass the Mortgage Bailout Act....but it has other things on its mind!

Oh, yeah, would giving more than 48 hours notice for closing make sense? That way, everyone involved can prepare "in case shit happens"!

And how 'bout mandatory disclosure of a lender's financial status?I hope Congress doesn't step in....folks say they don't want the government in their business and as soon as shit hits the fan, everybody wants them in...if the Government steps in and start to regulate, you would have never own the property you owned...let's not start feeling high and mighty now that you are a homeowner....

the bottomline is that if it wasn't for Reagan de-regulating the mortgage industry, 90% of us middle income folks(and you know what I mean) would never own a piece of this American dream. So pleasssse, stop the "government come save us" nonsense....

48hrs for closing means absolutely nothing with a Lender going out of business...I don't even know what you mean by that...also, I don't know what you mean by the why I timed my moving 30 days after closing statement...that has no bearing on anything!

[mhd]

I hope Congress doesn't step in....folks say they don't want the government in their business and as soon as shit hits the fan, everybody wants them in...if the Government steps in and start to regulate, you would have never own the property you owned...let's not start feeling high and mighty now that you are a homeowner....

the bottomline is that if it wasn't for Reagan de-regulating the mortgage industry, 90% of us middle income folks(and you know what I mean) would never own a piece of this American dream. So pleasssse, stop the "government come save us" nonsense....

48hrs for closing means absolutely nothing with a Lender going out of business...I don't even know what you mean by that...also, I don't know what you mean by the why I timed my moving 30 days after closing statement...that has no bearing on anything!

the feds must and will intervene, regardless of the factors that brought us to this point, further erosion will be disastrous for so many levels of society, from wall street to flatbush suburban soccer moms, homeownership is the holy grail of us economic, political, and social structure...

[mhd]

Not too keen on having tenants. Also as a first time buyer don't I have to live at the property(at least for a period of time)?

no, unless you go through some govt. programs

[MYOR]

48hrs for closing means absolutely nothing with a Lender going out of business...I don't even know what you mean by that...also, I don't know what you mean by the why I timed my moving 30 days after closing statement...that has no bearing on anything!

It means that if the closing doesnt happen he wont be up shits creek.. Since he didnt give his landlord notice..

[mhd]

Just wanted to add that the original point, that the real change came(comes) through economic factors, is reinforced by your post. In the end that's what is transformed the neighborhood to shit and is what is transforming it back.

economic factors are part of it, but, gangs, drugs and civil rights breakthroughs are social and political factors, and economic factors can be controlled and driven by political will and influence, and that has always been our strength

[Fletch]

I hope Congress doesn't step in....folks say they don't want the government in their business and as soon as shit hits the fan, everybody wants them in...if the Government steps in and start to regulate, you would have never own the property you owned...let's not start feeling high and mighty now that you are a homeowner....

the bottomline is that if it wasn't for Reagan de-regulating the mortgage industry, 90% of us middle income folks(and you know what I mean) would never own a piece of this American dream. So pleasssse, stop the "government come save us" nonsense....

48hrs for closing means absolutely nothing with a Lender going out of business...I don't even know what you mean by that...also, I don't know what you mean by the why I timed my moving 30 days after closing statement...that has no bearing on anything!
This ain't about being high and mighty! From reading that broker's thread (are you Scrooge McDuck?!), How do you address a person the day of closing, thinking they are about to have a piece of the American Dream, and they can't get the money? And they are scrambling to get funding from other sources (that's why I proposed a government bailout). And buy the way, as was said, your landlord is expecting you out tomorrow (that's why I made referrence to the 30 day moving!) It's like a carpet being pulled form under them.

Oh, yeah, that same deregulation allowed the market to go unchecked, with predatory lenders to give out these non-traditional loans, mostly to people of color! And guess who's being foreclosed upon! Sorry Ray, but some accountability in the mortgage industry is in order. I said "some", and y'all can't even take that!

What's wrong with disclosures made by lenders of financial status? Oh, yeah, and how 'bout a Consumer Products Safety Commission for mortgages?

Oh, and speaking of middle class, there isn't much of it anymore in New York City!

[liL Ray]

the feds must and will intervene, regardless of the factors that brought us to this point, further erosion will be disastrous for so many levels of society, from wall street to flatbush suburban soccer moms, homeownership is the holy grail of us economic, political, and social structure...

true...but I am just hoping that it don't happen...and if it does, those that are thinking about owning, better borrow some dough and jump into ownership before whatever government changes go into effect....once the government make changes, it will take about 10 to 15 yrs or longer to change it back.

For those in foreclosure or nearing it, don't get embarassed and sit and watch it happen...call somebody (a mortgage loan officer) or pick up those calls that you been getting and see what your options are...one of them maybe you have to sell and take the little equity you have and just move on...maybe ownership was not for you.

[liL Ray]

This ain't about being high and mighty! From reading that broker's thread (are you Scrooge McDuck?!), How do you address a person the day of closing, thinking they are about to have a piece of the American Dream, and they can't get the money? And they are scrambling to get funding from other sources (that's why I proposed a government bailout). And buy the way, as was said, your landlord is expecting you out tomorrow (that's why I made referrence to the 30 day moving!) It's like a carpet being pulled form under them.

Oh, yeah, that same deregulation allowed the market to go unchecked, with predatory lenders to give out these non-traditional loans, mostly to people of color! And guess who's being foreclosed upon! Sorry Ray, but some accountability in the mortgage industry is in order. I said "some", and y'all can't even take that!

What's wrong with disclosures made by lenders of financial status? Oh, yeah, and how 'bout a Consumer Products Safety Commission for mortgages?

Oh, and speaking of middle class, there isn't much of it anymore in New York City! I am going to have to make a date and buy you beers and have a healthy debate over this....we could go back and forth for hours on who exactly are these "predatory lenders" and who exactly are responsible for this breakdown....the only reason why the mortgage brokers are looked on as the crooks is because you can actually see them and point at them...meanwhile the real people who created these programs are sitting in the executive offices of these major lenders.

beers and a debate anyone?

[mhd]

true...but I am just hoping that it don't happen...and if it does, those that are thinking about owning, better borrow some dough and jump into ownership before whatever government changes go into effect....once the government make changes, it will take about 10 to 15 yrs or longer to change it back.

For those in foreclosure or nearing it, don't get embarassed and sit and watch it happen...call somebody (a mortgage loan officer) or pick up those calls that you been getting and see what your options are...one of them maybe you have to sell and take the little equity you have and just move on...maybe ownership was not for you.

i get you, and i can see that as a possiblitiy,but, i think the cat is out of the bag and people, more and more, understand the value of homeownership. there will be an increase in homeownership going forward, tighter regs, but also more incentive to get people into homes - the right way

[Fletch]

I am going to have to make a date and buy you beers and have a healthy debate over this....we could go back and forth for hours on who exactly are these "predatory lenders" and who exactly are responsible for this breakdown....the only reason why the mortgage brokers are looked on as the crooks is because you can actually see them and point at them...meanwhile the real people who created these programs are sitting in the executive offices of these major lenders.

beers and a debate anyone?A DHP afterwork is in order (but not necessarily to debate homeownership! haha!).

Anyway, it's across the board. It is all about doing homework on the borrower side and doing the right thing on the major lender and broker side.

A little story.....I go a prequalification from a major bank. The bank sent me it's proposed settlement sheet with its estimated closing fees. I looked at it, compared it to others I got, and said 'damn'! I called the rep, to inquire about the fees. He says, I kid you not, "man, those fees in New York are expensive"! (his exact words, plus the tone in which he said it!). I ran it by my attorney, and he was like "their fees are a bit high!"

I know that New York has the highest median closing costs in the country! And when they see New York, some of these bankers/brokers start thinking, in the words of Full Force, "I smell pussy!" That's my little issue. Go figure!

I chose another lender. (I won't disclose the lender, unless y'all really wanna know)

[gman]

^

[C hristian]

Everyone whose looking to buy for the first time, or refinance their own home should do themselves a favor and look at getting the best deal you'll ever hope to get through NACA .

https://www.naca.com/index_main.jsp

and then work with agents who work with NACA.

no fees, no closing costs.

Why and how is NACA the best? B/c they sat in and disrupted more than enough shareholders meetings of the big banks, (bank of America , Citigroup, Fleet) and threatened to continue doing so until /unless they got their way. WEll they did get their way to the tune of $2 billion with a B dollars. They got the banks to agree to no closing costs, no fees,30 year fixed rate mortgage.

their rate is GUARANTEED to be 1% below market rate, and you can also buy down your rate too!

It's worth your while to check them out at the local chapter near you. trust me when i say that you'll be glad you did!

[Fletch]

Everyone whose looking to buy for the first time, or refinance their own home should do themselves a favor and look at getting the best deal you'll ever hope to get through NACA .

https://www.naca.com/index_main.jsp

and then work with agents who work with NACA.

no fees, no closing costs.

Why and how is NACA the best? B/c they sat in and disrupted more than enough shareholders meetings of the big banks, (bank of America , Citigroup, Fleet) and threatened to continue doing so until /unless they got their way. WEll they did get their way to the tune of $2 billion with a B dollars. They got the banks to agree to no closing costs, no fees,30 year fixed rate mortgage.

their rate is GUARANTEED to be 1% below market rate, and you can also buy down your rate too!

It's worth your while to check them out at the local chapter near you. trust me when i say that you'll be glad you did!
Some of those examples look too good to be true, but I'll at least take a look into it!

[C hristian]

it's only as a result of one man's persistance at suing or threatening to sue and disrupt the crap out of the banks that make the game by setting the rules to their loans.

that's the only way.