Refinance drama.....am i alone?

Question

With the mortgage lenders now tightening the subprime lending industry's standard, will it make it harder for me to refinance in the up coming months? I purchased my home two yrs ago with a 100% financing, and am looking to refinance in the next few months. Does that means I would not able to refi? I don't have any equity since prices have came down a bit. I made all my payments on time if that helps. The crazy thing is that regulators are now pressuring the lending industry to reduce or stop making subprime loans, aren't they making the matter worst? I mean I can see the benefits of this but does it only applies to new home loans, existing loans, or both? I'm sure i'm not alone but what everyone will do simliar to my situation? Please advice....

Answer 1

The rules of high loan to value lending are changing so quickly that it actually changes from moment to moment as sub prime lenders fold their tents and steal off into the night. The failure of large players in that market like Fremont and New Century, to name just two, coupled with the numerous malfeasance investigations and predatory lending in that market will make it more difficult, if not impossible for those with credit challenges to obtain financing. First payment defaults are high and rising, delinquency rates and foreclosure rates are climbing. This is a reflection of lenders making loans to people for homes they simply cannot afford. That's not doing any one a favor.

The fact that you have been making payments for 2 years should stand you in good stead. You may qualify for the financing anyway. It is worth checking out but, as a previous responder said, don't jump out of the frying pan into the fire. Make certain what you are planning makes sense, don't let anyone sell you on something that may end up making your situation worse in the long run.

Feel free to email me if I can answer any questions for you.

Answer 2

It is actually the end investors that are tightening their buying guidelines on the mortgages which is causing the change in subprime lending. Also, they aren't looking to reduce the lending but rather just the crazy guidelines they lend on ie; zero down, no income verification, first time homebuyer with no money in the bank.
If you can document your income and have a 680+ credit score then you should have no problem refinancing at 100% on A paper. If you can not document your income there are still plenty of programs out there and you still shouldn't have a problem on an Alt-A program.

Answer 3

1. Sub-prime loans are typically for borrowers with average or less then average credit scores, credit discrepancies, etc...on Purchases and Refinances...(Somewhat of a category from the people with perfect credit scores)
2. A Paper Interest Rates (Mortgage Industry Term) are for those with excellent credit with very little blemishes, typically these candidates receive better rates...
3. Most of Americas have substantial debt and average credit scores (674-687). Sub-prime Lending will obviously not fade into the sunset in regards to stringent rules and regulations. If so, this would cause a huge problem for the market and would burden every American with average credit.


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Answer 4

Pretty sure that you will find every financial clarification at: financial-care.info-

RE Refinance drama.....am i alone?

With the mortgage lenders now tightening the subprime lending industry's standard, will it make it harder for me to refinance in the up coming months? I purchased my home two yrs ...mostrar más

Answer 5

If your credit is good and you've never paid late, you might be able to refinance your subprime loan. However, if you have no equity in the house, you will have to come up with some closing costs. Make sure you run the numbers and it's better off for you in the long run before you refinance.