You know that there have been an extremely few loan modifications approved that included a principal reduction. In fact, the loan Mod's that I have been granted the viewing of - they are lack luster to say the least. With the first five years being reduced to 1/2 of the interest rate - The Loan being extended from 30-40 years - and increasing in small increments after the first 5 - They have been truly, less than stellar.
There is a lot of talk about the mortgage market these days, inducing speculation about future changes. There is no doubt that mortgages have been tougher to obtain these days but it is, after all, the incredibly loose practices of the not so distant past that led to the drastic bursting of the housing bubble in the first place. It wasn’t too long ago that your family pet could practically qualify for a mortgage.
So, what might the changes include? For starters it appears that a down payment of 20% or more will be an absolute necessity to purchase a home. There is talk of the 30 year mortgage going away. In addition it could be that a FICO score of 690 or above would be necessary to obtain a loan.
In addition to any changes that may occur in the mortgage industry, those who cannot qualify can acquire a private loan, but at what cost? Certainly a loan will be obtainable but the interest rate could be quite a bit higher than a conventional loan.
Any changes to the mortgage market are strictly speculative at this point in time. However, the uncertainty of the future of the mortgage industry, combined with the fact that rates have risen nearly three quarters of a point in the past six months, begs the question as to whether now might be the best time to invest in real estate.
When considering Real Estate it is not enough to contact an agent and hope to be guided toward the light. It is very important you read all of the information you can online about what "said agent" is telling you. I love to have my work double checked for accuracy. The day that I start to mislead anyone of our clients or anyone for that matter - will be a Cold Day in Hades.