It’s all gloom and doom these days. Families, by the thousands, are losing their homes. Mortgage rates are going up and the latest people to get hit by this are the poor families trying to secure “jumbo” loans for their Mcmansions. Okay, that’s a little harsh. In some areas of the country you pretty much have to get a jumbo loan to buy even a starter house (think: California).
Anyway, apparently there are plenty of people out there seeing their closings going down the tube because the funds for their loans are disappearing right before closing. It doesn’t matter that they were prequalified, or approved. It’s all about the size of the loan.
And then there is the story in the paper today about housing prices dropping faster than at any time since 1987. Ouch. I guess I should feel a little bit better about this since Seattle bucked the trend and actually saw an increase. I guess that’s a good sign although who knows how long that will last.
http://seattletimes.nwsource.com/html/businesstechnology/2003857155_webhomeprices28.html
This probably isn’t the best time to try to start flipping houses. Luckily our plans are long term and we aren’t “flipping”. I feel a little exposed with the lake house that we are building but I know that, no matter what, I won’t lose money on it if I had to sell it in a jam. Worst case scenario I’d break even. The only way we would ever consider selling is if I lost my job. Hopefully that won’t happen any time soon. I’ve been at the same company for just over 6 years and the company is selling the heck out of it’s product. As long as I don’t get “sourced” I should be okay.
I feel sorry for the people that are being impacted by the adjustable rates going up. I’m sure this is really cramping their budgets. Some of them will be okay, while others are clearly SCREWED. As the media covers the housing crunch, I keep hearing more and more stories about surprise loan terms at closing etc. People definitely need to really keep their wits about them. Do you know someone that ended up with loan terms that they didn’t anticipate?
Filed under: credit/debt, economy
