Housing outlook clouded by expiration of tax credit

Ed Wright at 09:48 2010-07-19 said:

Housing outlook clouded even more by Obama’s Banking Reform Legislation More so than any extension of a home buyer’s tax credit affecting the home buying market should be concerns of the pending democrat’s Banking Reform Legislation. Several components of this soon to be signed legislation will impact home values and buyers in ways few may anticipate.

First: 35% Maximum DTI loan requirements. This requirement, in combination with the NO STATED INCOME / NO NON INCOME REQUIRED Loans will destroy the values of higher priced California coastal properties. It has been estimated that fewer than 10% of those who own these homes now could qualify for new loans, let alone purchase a new home. If buyers can’t qualify, what good is a tax credit?

Second: The banning of YSP payments to brokers can only serve to drive up loan costs to borrowers, as banks are still allowed their SRP payments. Interestingly enough the Banks have never had to disclose their SRP payments to borrowers… but the YSP ban will put many more brokers out of business. Great news for the bankers, but bad news for borrowers who depend on mortgage brokers.

These requirements need to be changed, and or this joke of a “Banking Reform Bill” repealed. Permalink