Archive for August, 2007

Jumbo Loans Defined

Written by Timothy Blake on August 06, 2007 under Archives, Definitions

Liberal underwriting was not limited to subprime loans. Alternative-A, or Alt A, mortgages are granted to borrowers with good credit scores who want more flexibility than traditional mortgages offer for the overall level of risk they pose. Prime jumbo loans are larger than government-chartered Fannie Mae or Freddie Mac can buy, or usually $417,000 for single family homes.

Frankfurt Trust halts withdrawls from fund

Written by Timothy Blake on August 06, 2007 under Archives, Economic Impact, International

Problem contained? Only a U.S. problem? Subprime will not effect other countries? Think again as this article came from Germany on August 6th:

AmTrust Financial Corp, First Horizon

Written by Timothy Blake on August 06, 2007 under Archives, Lenders

AmTrust Financial Corp. announced it stopped granting loans that exceed 95% of a home’s value. First Horizon raised rates on Alt-A and jumbo loans in the past two weeks, Bloomberg News reported. LTV (Loan to value) is becoming a factor as it always was back before creative mortgages caused us to lose track of LTV. The slowdown in the U.S. housing market is entering its third year and will certainly continue if mortgage standards tighten. Lack standards have been blamed for huge losses in subprime and almost prime lending.

National City Mortgage VP – Credit Tightening

Written by Timothy Blake on August 05, 2007 under Archives, Lenders

Lenders are quickly closing the door to borrowers with low credit scores, small down payments for a new home or little equity in their current homes. Homeowners and buyers in high-cost areas such as California, Florida and the Northeast are also reeling as lenders chop “jumbo loan” programs.

Freddie Mac’s Position in August 2007

Written by Timothy Blake on August 04, 2007 under Archives, Government Positions, Lenders

The Office of Federal Housing Enterprise Oversight, which regulates both Fannie Mae and Freddie Mac, in July directed them to avoid loans that did not meet standards set in June by bank regulators. Freddie Mac chief executive Richard Syron said with credit pools drying up “there are some loans that are in difficulty. There are other loans that probably should never have been made and providing more liquidity will make that situation worse in the long term.”

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