Happy New Year.
I spoke to one of my favorite lenders, Jennifer Foster at Suntrust Bank in Chapel Hill/Carrboro, and asked her about loan requirements for my buyers this year. I was especially concerned that first time buyers were going to have to amass huge down payments because of the credit crunch. My questions to her and her reassuring answer follows:
Mari: "Are you still able to make loans with as little as 5% down? If not, what do buyers have to have? Is 3-6% about right for an estimate of closing costs? Are you requiring reserves?"
Jennifer:" I still have Fannie Mae 100% fixed rate financing and 95% financing. FHA is coming out with 99% financing to replace their 97% financing in response to the struggles in the industry. Fannie Mae has not changed their guidelines on reserves, but I expect underwriting will be more favorable if those folks with scratchy credit show some reserves (even if it's 401K). Grant money is back and FHLB replenished us with more than we got last year. I think 2008 is going to be fabulous."
I think 2008 is going to be fabulous...ahh....just what I wanted to hear. I hope 2008 IS fabulous for you. Make it a great new year.
