The Return of Sub-Prime Lending (loan, foreclosure, financing, loan)

[Pfhtex]

First we saw the rollout of non-repayable "Grant" programs that cover the entire FHA or Conventional Down Payment, and now this.

Conventional Loans for borrowers 2 years out of Foreclosure or Bankruptcy, 1 year out of a short sale, down to a 600 fico, up to $1M.

I don't know what to make of this. I'm getting that old 2006 feeling.

[berniekosar19]

Originally Posted by Pfhtex

First we saw the rollout of non-repayable "Grant" programs that cover the entire FHA or Conventional Down Payment, and now this.

Conventional Loans for borrowers 2 years out of Foreclosure or Bankruptcy, 1 year out of a short sale, down to a 600 fico, up to $1M.

I don't know what to make of this. I'm getting that old 2006 feeling.

That is absolutely insane. I know everyone is hoping a more robust housing recovery will perk up the economy but it's like everyone has forgotten that 2008 happened.

[VictorBurek]

Before we start bashing a new program, what are the rest of the details? What is the max loan to value? is this a private money lender? Do they have to document income? Do they have to show assets?

This is most likely a private lender requiring at least a 20% down payment. What got us into the last issue was allowing 100% financing to anyone, not only on primary home, but on investment properties.

Subprime lending should come back, but the guidelines need to be toughened.

[Pfhtex]

It's my company. Not hard money. LTV only gets difficult over half a mil. 3 discount minimum across the board.

[Modification Specialist]

Originally Posted by Pfhtex

.....Conventional Loans for borrowers 2 years out of Foreclosure or Bankruptcy, 1 year out of a short sale, down to a 600 fico, up to $1M.

I don't know what to make of this. I'm getting that old 2006 feeling.

Dito on the pre 2006 feeling....

[Htown2013]

Regulations can help but can also restrict freedom for those who do they're homework and know what they're doing. My uncle became a multimillionaire from buying multiple investment properties with very high LTV low DP and all had positive net cash flow.

Nowadays it is practically impossible to do what he did, as lenders require 25% down and higher interest for investment property, making cash flow much less attractive than when my uncle acquired his properties 20-30 years ago.