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Who says that you cannot get a home loan for $4 million?

Great article from KW Commercial Sa's Ask the Expert Page (join the RSS feed at www.kwcommercialsa.com/blog  .  Read Kate Cline's Article at http://kwcommercialsa.com/blog/?p=668

Who says that you cannot get a home loan for $4 million?

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Who says that you cannot get a home loan for $4 million?

Since the turn of the real estate market, mortgage lenders have been "tightening the boot straps" on their underwriting requirements.  I like to compare it to when you crash your computer or get that blue screen of death, then you have to totally shut down the computer and reboot.  Like in a reboot, certain icons come back to the screen FIRST and some are never recovered.  This is very similar to what has happened to the amount of mortgage loan that are available to borrowers.  Before the decline, you could state just about anything, not pay your bills and there was probably a lender out there that could get you a loan.  Needless to say, that is what CRASHED the market (or computer in my example above)!  We are now SLOWLY rebooting our mortgage products.  Some products came back quickly and some will NEVER return.  (On a side note, I was never a support of some of these loans that will never return.  Who thought foreclosure bailout loans were a good idea ever?  Sadly, some lenders did)

 One area of mortgage lending that was hit considerably was the JUMBO market.  To clarify, a JUMBO loan is one which exceeds Fannie Mae and Freddie Macs limits of $417,000.  These loans are held by private investors who got hit the hardest when the market crashed.  (Note: These investors are also the ones that thought stated income, state asset loans were a good idea - and for some borrowers they are, most they are not.)   We are starting to see a new trend of investors that are willing to do these JUMBO loans.  (Another icon has appeared!)  It has been a long process.  When they first started to come back, the terms, conditions and rates were horrible to say the least!  Now there are some investors that are loosening the boot straps ever so slightly.  One must have excellent credit, financials and a 20% down payment, however the rates are starting to become more in line with what they should be.     

If you have any questions about these types of loans, please feel free to contact me at anytime!

Kate Cline
Senior Loan Originator
United Lending, LLC
2338 N. Loop 1604 W, Suite 290
San Antonio, TX  78248
210.408.6060 Office
210.918.6846 EFax
kate.cline@unitedlendingusa.com

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Comment balloon 0 commentsLink LeGrand • March 24 2011 08:50AM
Who says that you cannot get a home loan for $4 million?
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