| Living in a Tough Economy: Part 2
With the recent trouble in the sub-prime mortgage market, credit ratings have become key to obtaining money to buy a home.
"We have 100-percent loans everywhere if you can show the income," said Michael Fuller, president of Northern Arizona Mortgage Corporation.
He said the recent failure of more than 40 sub-prime lenders should not have any impact on the conventional loan market for homebuyers with credit scores of 620 points or above.
"In the last 90 days, the sub-prime lending portion of our business has experienced a meltdown," Fuller said.
He said the meltdown occurred basically because loans were being made to people who shouldn't have gotten them. He said the situation has effectively ended the sub-prime lending market.
But conventional and government loans, even no-money-down loans, are still available.
S. Florida mortgage firms scrambling amid subprime squeeze
South Florida has much at stake in the furor over the quality of the so-called subprime mortgage market that sent Wall Street into a tizzy last week and has lenders across the nation re-examining loan portfolios.
The region has a higher rate of loans to borrowers with shaky credit than the national average. Meanwhile, the troubles of New Century Financial Corp., the nation's second-largest subprime lender, have affected local offices of one of its subsidiaries.
Home 123 Mortgage, which has offices in North Palm Beach, Boca Raton and Plantation, has stopped funding existing loans and accepting new business, as has New Century.
The Home 123 offices remain open, and employees are working to find new lenders for clients and arrange for closing agents to refund any money they might be holding.
Bankrate: Mortgage Rates Rise for 3rd Straight Week
NEW YORK, April 5 /PRNewswire-FirstCall/ -- Fixed mortgage rates moved higher across the board this week. The average 30-year fixed mortgage rate rose to 6.25 percent. According to Bankrate.com's weekly national survey of large lenders, the 30-year fixed rate mortgages had an average of 0.27 discount and origination points. The average 15-year fixed rate mortgage popular for refinancing increased to 5.97 percent. On larger loans, the average jumbo 30-year fixed rate grew slightly to 6.52 percent. Adjustable rate mortgages stepped-up with the average 5/1 ARM to 6.12 percent and the average one-year ARM rose to 5.97 percent. Mortgage rates nudged higher, but only slightly so, for the third consecutive week and are still stuck within the same narrow range they've been in for most of the year.
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