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High Country mortgage bailout

BOB KIEBER

For the past couple of weeks all I have seeing on Television and reading in the papers is how the economy is tanking and the mortgage market is non existent. I see that everyone’s retirement plans have lost a lot of their values (everyone except the former Fannie and Freddie CEO’s). And I have heard how no one is getting approved for a home mortgage because mortgage lenders have no money to extend credit.

Let me first say is that there are mortgages still being underwritten and approved. Mortgage lenders do have funds to lend on mortgages but the rules have changed. Mortgages for single family homes are by far the easiest mortgages to be approved today and condos have become a bit trickier. Plus, here in the High Country, with so many of the condos being second homes there are a few more hoops to jump thru before and Underwriter will decide to approve or deny the file. We need to look at a couple of different scenarios to understand what an Underwriter is evaluating and why they are doing what they do.

The most common mortgage being underwritten is the one for a single family home where the buyer will make it their primary residence. Underwriters are looking for a decent credit history from the buyers and that they have a stable work history. The home itself must appraise for the value they buyers have agreed by contract to pay for the home and the home is in acceptable condition. There are still many mortgage investors who will lend ninety seven percent of the purchase price to borrowers even in today’s tight mortgage marketplace.

The there are buyers looking for condos as a primary residence. Condos are tougher to finance today, especially when you compare it to the market just one year ago. Mortgage lenders will not lend out ninety seven percent in many cases are here in the High Country. If the condo association has previously been FHA or VA approved lenders are very willing to approve mortgages on those properties.

Now we get into second home and investment properties. Lenders have tightened up the requirements for these properties. The minimum credit scores required today are much higher than they scores required just a year ago. The investors are also requiring a larger down payment on these properties and higher credit scores from the buyers.

Basically, I am now seeing buyer and property requirements tighter today than a year ago but back to the requirements that I dealt with eight to ten years ago. So what goes around comes around.

So if you are considering the purchase of any real estate in the near future you need to meet with the mortgage professional sooner than later. Know what is and is not acceptable in today’s mortgage marketplace.

For answers to your mortgage related questions call Bob Kieber at (970) 262-1199 or e-mail him at rkieber@comcast.net. Bob is a local mortgage lender and principal of Resort Lending. He has 30-plus years of professional experience in real estate, finance and investments, and is a longtime resident of the High Country.


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