Important stuff on more restrictions for jumbo loans over at The Great Loan Blog yesterday (thanks for the heads-up):
This week we witnessed a dramatic change within the jumbo mortgage and luxury financing space that has broad implications for housing markets across the country. It appears to have started with Wells Fargo on Monday and spread within a day to all investors whether bank, insurance, pension or hedge fund money sources. ...
Program loan to value limits were cut between 5-10% at most investors. We received dozens of calls from brokers, realtors, and loan officers across the country desperatly searching for 20-25% down financing for their purchases that now require 30-35% down or millions in reserves which most clients don't have. Programs are available to put 20% down on property up to 6m but they require 1-3m plus in liquid assets beyond the down payment. ...
Making it even harder to move the glut of $3M+ Westside houses.
5 comments:
Wouldn't anyone buying a $6M home have $1-3M in liquid assets anyways (except a few business owners in illiquid businesses)?
i think the banks are saying THEY SHOULD, not necessarily that they would. money was too easy to come by before. No more.
I suppose I'm just amazed that anyone would feel ok taking a $35,000/month mortgage with less than that much money. I mean, a lot of homebuyers were absurd, but this just seems like a different level.
(I do have $1-3M in liquid assets and there's no way I'd feel comfortable with a $35k/mo mortgage...)
california laws make it very logical to buy a house with no money down and take on a 35k monthly mortgage. plenty of people did this, and made millions in profits
the point is, keep doing it, keep flipping houses and taking the profits and putting them in the bank, then when the market turns down, just mail in the keys on whatever house you happen to have when the market turns down
you get to keep millions in profits sitting in t bills and stiff the bank on the last house
if anyone ever offers you a no money down house you are a fool not to take it
4:49pm -
the you are probably closer to the $1MM than you are to the $3mm. It must be hard for you.
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