With IndyMac going under how hard do you think it will be to get a mortgage now?

Question

With IndyMac going under how hard do you think it will be to get a mortgage now?

Answer 1

There are people willing to lend money on real estate....BUT THEY ARE TAKING A LONGER LOOK AT THE BUYERS INCOME and DOWN PAYMENT.



     The issue is one of risk.....People with money do not want to take risks. Those investing in Mortgages and Notes are seeking a steady income stream that allows them to sleep at night.

     The market effects of IndyMac will be greatest in the Pacific Southwest where they conduct a majority of there business.

       In most parts of California and several in Nevada, the real estate market continues in a freefall. Under those circumstances, you should not be surprised if home loans require 30% to 40% down payments (equity cushion) by lenders. I would still hesitate to loan money on Southern California real estate with 40% down payment unless the buyer had a very secure employment, outstanding credit on a property purchased at a very fair value that was located in a prime area. It is bad out here and getting worse... Home prices still have a long way to fall.

        Income property is benefitting from the decline in SFR values. These are increasingly purchased based upon cash flow.... Yet most apartment buildings are selling well above their value on a cash on cash return. These values will fall but not like single family housing. (Where do all those losing homes to foreclosures go?)

       As real estate funds are drying up, other money for commercial business and trade is harder to obtain. Many small businesses are struggling to survive as even the steadily employed who purchased homes years ago are cutting back on purchases to weather this economic storm.

       Money in all forms is tight. If you have money...hold on.

Answer 2

It's funny as I'm on the east coast, I answered something about indymac last night, I didnt see this until today.  I'm not worried about indymac, some banks had to go, countrywide got lucky with B of A taking them over, but in B of A's case, be careful of what you wish for.  What I'm concerned about is Fannie and Freddie.  You just never hear the truth, only the insiders now what is really going on, if there are troubles there, then we have a major problem.  I'd say over half, probably more, of the mortgages today are backed by them.  I will say this, if your in the market, get shopping, you just never know

Answer 3

Small fish. Fannie and Freddie are the real breakers.

Let's get rid of the Fed and call it a day.

I got my gold reserves piled high. No mortgage problems for myself!