How the Media Are Hurting the Economy

A Mortgage Broker's Analysis

I was speaking with a potential client today, and after telling him what I could do to help him refinance his home, he asks me, "is it really this simple?" I let him know that it was really that simple.

Wherever you turn, whether it be your local news or CNN or Fox News, you are hearing that the housing industry is terrible and that no one can get financing right now. That is simply not true. Yes, the housing market and lending industry has taken a tumble, but this does not mean that you can not buy a home or refinance your home.

We have seen a sharp decline in clients interested in doing anything with their finances lately because ll they hear is bad news. I saw a report today that showed home foreclosures were up 25% from October of 2007. This information scares people, and it gets them to thinking that if things are this bad, and lending has dried up then we can not buy a home, or refinance our home.

Let me tell you the truth. While it is true, that things have tightened and some loan programs have gone away, things are still not that bad. FHA and Conventional financing is still 97%, which means you would have to put 3% down. You do not have to have perfect credit and interest rates are still amazing. Conventional financing is a little tougher because they do have stricter guidelines, but it is still available. FHA has much looser credit guidelines, so you do not have perfect credit to get financing. You can't have bad or poor credit, but it doesn't have to be perfect. There is also something called a Rural Development loan. This and VA loan are the only true 100% loans out there now. Rural Development is truly no down payment. Once again, you do not have to have perfect credit, and interest rates are very good. The biggest down fall of this loan is, it is not available in every area. By definition is is for rural properties or small communities. I live in an area with several smaller towns and a couple larger ones. The largest population is around 50,000, and it is not eligible. However, the smaller ones (around 10-15,000) are eligible.