By Bill Grasska, Teles Financial/www.telesfinancial.com

Mortgage Financing certainly has been interesting the past 12-18 months. Real estate foreclosures skyrocketing, home values dropping, and what is that you said? You can’t get a jumbo home loan even though you are a good borrower?

That is right America! With everything that our Government has done to help our economy and bailout our large financial institutions; if you have a loan amount over $729,000 it is almost impossible to get a fixed rate loan. There are only a handful of lenders funding jumbo home loans and these are only on adjustable rate loans. These loans are typically fixed for 5 or 7 years. Did we not learn anything??

Who cares about the rich and wealthy? We all do!! Every tier in the real estate sales pyramid is vital. The base of the real estate market cannot move up if the top is not selling as well. This spells for a difficult real estate market recovery!! Market compression is a bad thing, when it comes to the national and even global real estate market it is nothing less than a crisis!

Approximately 95% of every real estate loan in the country is being funded by or insured by, you guessed it Uncle Sam. Our Tax Dollars!!! FHA, Fannie has not had a terrific track record as of late, and I would bet that the future does not look very bright.

Our economy is hopefully on the verge of recovery, however there is a huge backlog of real estate foreclosures looming on the horizon. Subprime lending and easy credit got us into this mess, is the Federal Government really going to get us out?

“Notice of defaults” have skyrocketed!! These nonpaying borrowers are, are you ready for this, not subprime borrowers! The next wave of real estate defaults are all coming from “A” paper, all American borrowers. They are losing their homes primarily due to a lack of financing.

The FHA is lending with 3.5% down, with no minimum credit scores and high ratios… is the Federal Government just inviting another subprime fiasco?

The lower end of the Real Estate Market is going gangbusters and sales are reaching a frenzied pace. The upper end of the real estate market however is still looking at a possible, very scary, long way down.

For more information, please contact Bill Grasska at 310-888-3241 or email him directly at bill.grasska@telesproperties.com.

Filed under: Uncategorized on July 10th, 2009