Low down payments coming back to Danville!

Comments(0) By Mike Miller •May 20th, 2008

Great news for Danville area homeowners! Effective June 1^st, 2008 the “declining market” loan to value adjustment will not be enforced at Capital Market Funding. This means that homebuyers will more easily be able to buy a home with 5% or 10% down. Of course the FHA programs will allow you to buy with only 3.5% or in some cases no money down, but now we have double the number of programs to choose from. This is great news for many first time homebuyers, or for people who want to refinance but who temporarily have less equity!

And speaking of equity….

Washington Mutual has apparently closed all Home Equity Lines of Credit across the country. It seems that the amount of money being made off of the interest on those loans was NOTHING compared to the losses the bank was experiencing. Let’s say for example that a bank makes six percent on a $100,000 loan, that would be $6000 a year. Now imagine a borrower who got a loan 3 years ago, who lost equity, or lost a job, borrowing that $100,000 on the existing line of credit and then walking away from the house? It would wipe out the one year return on over 16 other “good” loans that were made by the bank. The good news is that I have several large institutions making lines of credit loans, so contact me for details!

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Filed Under: Borrower Tips