Texas Home Loan Blog: Oh, did I mention? 100% financing is very much alive and well!!!

Even here in Florida, 100% financing is still possible. :)  Very few lenders though- but IT IS possible...

Great post!  I wish my company was doing business in TX...I'd be knocking on your door with a bunch of clients needing financing.  What about subprime...any thoughts on that?

So is it safe to say that doing 100% loans for a client that can not prove their income is impossible now?

Thanks for the post. It's easy to think everything is changing...more so than it really is.

Wendy, I just firmly believe that fill doc borrowers will not be affected too much. Except maybe in places like Las Vegas(for the short term) where I understand that values have been an issue.

Jason, Thanks for the comment. Subprime was too aggressive. The lenders kept feeding what Wallstreet was buying until Wallstreet opened their eyes and cut it off. Measuring loan performance will be important for subprime to come back. I believe it will...

Anonymous, I don't expect 100% to be available for low doc borrowers for a while. These loans were priced too cheap for the risk and it finally snuck up and bit the investors. If low doc borrowers ever get 100% back, expect the pricing to be more premium than in the past.

Ardell, Lending made some mistakes. The risky loans were not offset with enough price adjustments. What we have now is a knee jerk reaction until the market can figure out how to proceed. Thanks for stopping by.

Great post & reminders Mr Burris!  Since you mentioned using a Realtor (R) in a new construction transaction, I was wondering if the use of "builders preferred lenders" was rampant in TX like it is here.  If it is, I would also recommend getting second and third outside of builder preferred lender opinions because you will pay for all those incentives, one way or another!

Tom,  I just have to say THANK YOU!!..for writing this post. I cannot tell you how many calls I get asking the same thing. 

Renee, yes we have the preferred lender thing going on here..... and some illegally tie incentives to the use of the preferred lender as well. Mostly the strong arm tactics are used by the larger/national/regional builders. The smaller builders aren't as nasty about it.

I have seen some borrowers get a great deal from preferred. And I have seen the preferred try and rip off others. Important to get second opinions!!!!!

Matthew, thanks. Feel free to send all of your clients a link to my blog for reference. (j/k)

 

Do you tink the preferred lender issues might ease up a bit as Countrywide struggles?  Around my parts at least they seem to be "the one" for in-house deals (i.e., illegal tying).  See http://activerain.com/blogsview/174573/Countrywide-on-the-Ropes.

I really don't know, Jason.

Countrywide is no worse off than the rest of the lenders. And I would expect CW to try and hang onto that business.

Hey Everyone.... Chase's state of the industry response is simple. Offer people mortgages but be smart about it. We still have: 100% LTV F/D 95% LTV Stated or reduced doc 100% LTV Bank Statements (personal or business) Non-Occupant co-borrowers (Still considered Owner-Occ) Credit Score down to 520! (realtors looking to improve marketing should visit: http://www.realestateshows.com/show.php?id=0000188791&var=show)

Very important post. We are still seeing many 100% deals closing here. But again, not for the 'have no money, bad credit, etc' customers.

100% LTV? In this market? Good luck selling that paper!

Tom, this post is just what we Realtors needed to hear.  I have two closing next week and I knew new loans were going to require docs and good credit but I truly wasn't sure if 100% would stay around at all.  Thanks so much!

Eric, Yes! Common sense underwriting will be the GOOD thing that comes out of this. And I expect Chase to back down to 90% soon. Little birdy sitting on my shoulder says next week.

Susan, Even marginal credit is ok as long as the last 12 - 24 months are good and the borrower has some reserves after closing costs.

Robert, What? Luck? It is selling everyday at 100%..... at full price. Did you read the post? If you still disagree, then please support your position with facts. Have you witnessed lenders not funding 100% full doc conforming loans? I have NOT. Except for the lenders who went out of business for other reasons.

Diane, Thank you.

And thanks for stopping by everyone!!

 

Great Post - the media is so short sited.  It takes diligence to sift through the 30 second soundbytes.

Enjoyed reading your post. Thanks for writing on the topic.  There is a local mortgage broker here that sends me a fax every once in a while and they often are ads for 100% loans.

Tom, this is great information. I have heard so many horror stories about the mortgage industry and the negative impact on the market. Since I don't plan to establish a niche in the first time buyer market I should do fine. My primary focus will be golf course communities. My target client will more than likely be move-ups and relocations.

Anyway, thanks for "chatting" with me earlier. I will add you as an associate, subscribe to your blog, give you a 5, and whatever else is out there. :-) Once I get started I will be sure to send some buyers your way.

It is definitely more difficult to get a 100% Financing Deal in Michigan.  We have been impacted by a number of issues including job losses & foreclosures. 

Tom -- glad you wrote this.  It seems that there is more gloom and doom each day and the lenders I deal with are actually cranky!!  Nice to read something encouraging.  Maybe things are finally normalizing!

Ibelieve that Bank of America has quit offering 100% financing.

100% loans are available here as well. Yep, it's more challenging but nothing as dire as painted by the media. Good post, Tom.

Jeff

A few thoughts:

Robert Kerr:  Full doc, 100% CONFORNING deals are a live and well.  In fact Freddie just expanded their affordable 100 program.  Selling that paper is not an issue today.

Jeff Dowler:  See my comment to Robert; it caps us at about $500K; tough in our market but getting better as prices subside.

Tom:  Great post.  I don't know how many Realtor calls I've fielded in the past 2 weeks where I highlight these facts.

The media seems to be overplaying everything. So people are getting scared and think that things are not possible.

Hey Tommy B, just coming back to congratulate you on your gold star!!! WOO HOO!  Oh and GO HUSKERS!

Brian:  I am one of those :ducking: 

You can still get it but you'll pay a rate close to 8%

we are still seeing 100% financing with excellent credit here in New Hampshire.  A lot of people can't qualify for these loans today.

Tom - Your post is so very true. Good loans with solid values and appraisals are still being done. It's the fogged mirror and your approved loans are the programs that are disappearing. I know numerous superstar producers throughout the country who are still busy because they never focused their business activities on non-prime or Alt-A business.

Hi Tom, What I heard today is that the "second" on a stated income has now been dropped by most lenders. Is this true? I had a closing Friday which has now been postponed because of this very thing. Luckily, my buyer has excellent credit and can do a 95% loan if need be. Can you send me information? Thank you so much. Debra A Brooks Brooksprimeproperties.com

Kate: Hi. Thanks for stopping by.... Yes, the media is invested in defeat. Thay have something to sell, and it isn't positive. MY info is free. ;-)

Judy: Hello. I can't wait to buy my investment property on Broken Bow Lake. Can you help me with that?!?!? LOL.  Beware of blanket faxes. But, yes, 100% is still viable.

Toni: Great talking to you. If you are ever in Big D.... look me up.

Lori: Come on down to the 'Great State'.... All positive and no bull!!!

George: As many lenders have.... 100% is tight on some programs. I have it on VERY good authority that they still offer 100%......

Jeff: Thanks for the comment. Please read my other post regarding 'Realtors in Declining Markets'

Brady_Master_Mortgage_Maker: Thanks. If the realtors are confused.... what do you thoink the public is thinking? Well, I suspect that you already know. I am getting those calls too!!!!

Bob & Caroline: Yep! It is our job to educate.

Renee: Wanna make a bet? GO SOONERS!!!!!!

Vanessa: YOUR statement is 100% wrong. Please review my other blog about people making comments about things they do not understand. Thanks for stopping by.

Joan: Thanks for the comment. Be mindful of your market. If it is not declining, your clients should be 'all good'

Tony: Some of the people I hear from need a Cicerone like you!!! And these folks are 'supposed experts' <= see my other blog about people who should not comment about things they do not understand. LOL

Debra: Things are changing so fast.... it is hard to tell what CAN be had. I heard that we were going to be getting back some Alt-A stuff tomorrow that recently went away.... but this was all in those 'super secret meetings' that I only hear about. LOL. But if we do get stated second liens back.... don't expect them to go to 100% CLTV. I will write myself a note to call you. I am not sure what will be on the teble to sell tomorrow.

 

 

Tom... I agree and disagree...... I haven't read any of the comments as of yet and I am not sure which L.O.'s that I will piss off....  

No, 100% loans have not disappeared.

BUT... they have become a lot harder. Each week, something is being tweaked. Fannie added a penalty of 1 pt a few months ago. Pricing is a little higher depending on the fico score. Put it this way, they are different than from 6 months ago.

In any case, I agree, these programs are still around. But knowing the changes is what makes you one up on your competition and having a backup plan.  Just my opinion and my .02. 

Full doc, 100% CONFORNING deals are a live and well.

At what rate, Brian?

Jeff: I have discussed in this blog post and another..... Fannie Mae has announced that they will scrutinize appraisals in declining markets. Las Vegas was named.... but I expect CA & FL to be included. The AU findings will flag your deal if the property is in a market that has been deemd 'declining' or that area is hard to valuate.

Robert: Under 7%.... just like it was a month or two ago. Rates have trickled up since then.... so I would have answered under 6.5% back then. This is for 100% or 80/20 combos that are 100% alive and well. Second liens have trickled up dur to risk.

 

Guys.... We aren't seeing outrageous rates for 100%. Just a small market correction on second liens for risk. 2nd lien rates vary by market.... so I do not quote them. But if you have 20% down and PERFECT credit with a gajillion dollars in savings for reserves.... you get 6.5% or maybe a little better. 6.75% or a little better for 100%.

NOTHING has changed on the first lien rates!!!!! Same adjustments for 100% vs. 95%(or 80% or whatever) as always.

AND................. That paper will sell!!!!!!!!!! At full price in the secondary market!!!!!!!

 

At what rate, Brian?

Not too bad, RK:

80% first at 6.5% for a 5/1 IO, 20% second at 9.5% for a 30/15

Not too bad, considering.  Its an agency world, an agency world 

I agree.... which was my whole point, especially in regards to your subject line.  Alive and well?  It doesn't sound so well after your last comment. I am not trying to knock you, but curious, which is it then?  Yes, 100% is still around, but it's not alive and licking like it once was. That's my point...  I think those that only knew my community will be lost when they crack down even more...  I just did two more FHA deals this week.....

Jeff: Alive and well!!! 2nds popped up a point or so(depends on market). Flex 100 fannie mae has had NO ADJUST. I always knew that the market was going to push 2nds out(if they can) and drive this towards insurance. But I am amazed that the 2nds have survived so far. <= pretty good perfrmance in this market. A small 1% adjust for risk? That is nothing.

Brian: Its an agency world, an agency world You took the words right out of my mouth. LOL

 

Thanks for the info. I have had a few conversations with "chicken littles" over the past few days. Although in NC, they've been passing some crazy laws. I think the self employed guy trying to buy a house is the one that's going to really be hit by it. But what do I know, I just design websites. :-)

Thank you Tom - I stopped going to media-held funerals a long time ago - the patient was never dead and the food horrible.  Timely (bookmarked) blog!

Hi Tom,

I'm not seeing it here in Broward ...at least not on any deals we are doing..I thought it was a good idea for the family that cannot afford a home but it bit everyone in the butt now...I'm not sure it dodn't do more damage in the long run. Good post about the information.

100% will be dead soon. The only 100% loan will be my community.

Hey Brad: Thanks for the comment. Yes, the slf employed borrower loses.

Art: LOL. Yes, according to them, we are all gonna die.

Neal: Uh. hmm.

Christopher: Dang, it will be dead soon? Really? Maybe I should change jobs. I mean, you seem to have all of the answers so I will just trust what you say even though you haven't backed that up with any facts or reason for your position. My Community will be all that is left? Hmmm. Says who? Did I miss a Fannie Mae announcement? Since Fannie Mae does My Community.... I will just wait on them.

Well, Tom, that's very different than what I'm seeing.

Today, Aug 16, 2007, I see exactly zero 100% LTV packages available from the major lenders.

Robert: Fannie Mae & Freddie Mac have not stopped buying 100% deals, either straight 100 or 80/20.

If you aren't a lender, and cannot sell directly to them.... there are lots of lenders that you can broker to that sell to them. These lenders basicaly give brokers access to Agency Products. Otherwise, try the banks. BofA, Well Fargo, Washington Mutual.

 

 I don't know what else to tell you......

CMG Mortgage is still doing 100% Full Doc loans (conforming)

90% Full Doc Jumbo

80% SIVA Jumbo.

Great post Tom.

Hi Steve: I got a lot of rate sheets today. Noone has gotten rid of the 100% Agency stuff.

 

Tom,

 

Thanks for the info, Good to hear 100% loans are still alive and kicking.

 

Reagrds

Dave Magua

Weston Florida

 Hey Dave. Thanks for stopping by

 

From a CW Account Exec. (seems that they still have 100% financing)

 

As our industry continues to go through such a challenging time, many of you have expressed concern with Countrywide's current position in the mortgage market due to the media's high degree of interest in Countrywide.

Countrywide has taken decisive steps which will address the challenges in this environment and enable us to meet funding needs and continue to grow.

It is business as usual for Countrywide which will allow us to maintain our position as the dominant lender in the U.S.

Here are some great things Countrywide is able to do:
-  Conforming Fast and Easy (allows stated income and assets to 95 LTV with 680 score)
-  100 % Financing (full doc programs such as My Community, Flex 100, and House America)
-  Expanded Criteria program (allows SIVA to 90 % 660 score)  Also, SISA, No Ratio, and NINA programs.
-  Next business day turn times for purchase, 24 hrs for conditions, we request full files.
-  Pay Option ARMS and Payment Advantage programs as well!

Thank you so much for your support!

There is alot of misconception that these loans are all history!  Putting the facts out there is great!  Congrats on the feature!

Hi Kim, Thanks! Even the supposed experts are perpetuating these misconceptions. Strange.

 

Tom.... in regards to what Countrwide's reps are stating, they are beingextremely picky when it comes to buying these loans. Besides, most of what you have listed above in what they can do, I have found other lenders that do these also and are very strong in them. Just a fyi.....

Jeff, I should have commented:

Obviously the rep is toting the company line. I only posted it because it shows that they offer 100% financing. Which RObert couldn't find yesterday..... 8-0

I just do loans. Our secondary marketing sells them. LOL

Agreed, at SunTrust, we still have all of our 100% options in place - Jumbo and Conforming. The programs are full documentation but support high debt to income ratios. We still have some high LTV options for the self employed.

The following are some examples of what I can do today.

80/20 Piggyback 100% Purchase.
My programs here have undergone little change. We still have all of our 2nd trust programs in place with little change in the interest rates. Yes, you can do 100% 2nd trusts for under 8%! We can support jumbo loan amounts on average or better credit.

80/20 Piggyback 100% Refinance.

I am actively doing 100% rate/term refinances at 'A' paper rates. For borrowers with average to better credit and financial assets. This is a great option for those with ARMs that adjust and may have purchased at high LTV in the last two to three years. The borrower needs to show some strength in their overall application whether it be credit, income or assets.

Single loan 100%, no mortgage insurance

I can do 100% financing in a single loan on the 30 year fixed. This will support below average credit profiles. $417k or under loan amounts.

Community Lending 100% Single Loan with Mortgage Insurance

These are FNMA backed programs that support below average credit and relatively low Mortgage Insurance rates. Income limits do apply and vary by geography. $417k or under loan amounts.

 Please feel free to contact me about any of these programs.

www.suntrustmortgage.com/mdjones

 

Hi David

Yep.... 100% is alive and well. I can't believe some of the people that think there is NO 100%

 

Tom, while I agree that 100% financing for those with good credit is still available, there's another factor that can't be overlooked:  the negative publicity may be inhibiting many qualified folks from even trying to get a mortgage now.

Hi Brian:

Yes, the media is invested in defeat. It is our job to defeat THEM!!!!!!

I agree I have had no problem getting buyers to closing.

I agree I have had no problem getting buyers to closing.

agreed, only improve the crdit to qualified for 100%.

Hi ladies,

Thing is.... credit guidelines haven't changed for our Agency products....

Less than perfect credit can still get 100%