Any real estate people in the house?

[Otto347]

Or know one? I heard that banks are not lending for town homes/condos due to all foreclosures with the shitty economy. Is there any true to this or is it just a rumor? Im in FL if that matters.

[NINJASPY]

yes town houses/condos mostly because they don't hold their value well, and most of those owners don't stay longer than 4-8 years. While single family households usually stay 10+ years or more, property value goes up faster(5-6% rather than 2-3%max [in cali]) , and its usually a bigger investment(cost wise) so people who make more, can afford more, and pay more, and less likely to default/foreclousure.

Many people looking for town houses are first time buyers, and banking institutions have been having problems with letting younger people buy houses that end up being taken away.

[Gnnr]

That they are not lending? That is not true.

Is it harder to get a loan? Yes.

There are some new rules put in place to protect you and the lenders.

But basically it comes down to this,

New Year, New Financing Rules For Condo Buyers - baltimoresun.com (http://www.baltimoresun.com/classified/realestate/sns-201001080558tmsrealestmctnig-a20100115jan15,0,1078035.story)

According to some lenders, Fannie Mae guidelines will reject a condo building if more than 15 percent of owners are delinquent in paying their monthly assessments. Likewise, if the condominiums' budget does not set aside 10 percent toward the reserves and improvements, under many circumstances the condominium will not be approved, particularly if the condominium is located in an area where real estate values have declined or are declining.

[FRpilot]

Be sure to have at least a 20% downpayment for a loan and great credit. The days of 10% or even 0% down are over.

At my work, we have clients pulling in over $500k/year with tremendously good credit and banks are still requesting a copy of the last 2 years of their tax returns for a refinance.

[tricky_ab]

Be sure to have at least a 20% downpayment for a loan and great credit. The days of 10% or even 0% down are over.

At my work, we have clients pulling in over $500k/year with tremendously good credit and banks are still requesting a copy of the last 2 years of their tax returns for a refinance.

This! Having a sizable downpayment and a good credit score will net you the load you are after.

[Vision Garage]

Since Im in the market to move into a house heres what my realtor has said. There are 3 main types of fiancing.

STRAIGHT CASH MONEY (BALLINGIN MOFOS)
Conventional Loans (20% downpayment)
FHA LOANS (3% downpayment)

Most of us will fall into the 3rd category since this is where i am in. If you are in the top two, Ill give you props. The downpayment will be determined by the cost of the house. so a $100,000 will have a downpayment of 20k for conventional and 3k for FHA.

Banks will take look at offers in the same order. CASH FIRST! Conventional second (because these people are less likely to forclose since they put so much down on the house. Less risk for Bank. AND FHA last.

FHA you need 650 score to qualify for the program now.

[I LUV MY S13]

ask norm

he was in real estate

[Matador]

As far as I know banks have not sworn off lending for condo/townhouses. They have made it more difficult to get any home loan (for good reason).

A few words of advice:
Expect to put money down. Have a minimum of 620+ credit score. You can try for an FHA backed loan, but I wouldn't rely on one. If you cant put a fair amount down or afford to finance for less than 30 yrs, you probably cant afford the place to begin with. When looking at what you can afford monthly, factor in taxes/insurance/home owners/condo assoc. If you do not pay these things monthly (tax/homeowners/condo assoc) they have the right to foreclose...which is bad. Since you're in FL there should be plenty of properties on the market. Many are bank owned REOs others are listed well below market value attempting short sales. These can be great deals, but plan on investing lots of time trying to buy them. Now is a great time to buy if you have money, credit, and a very stable job. Not such a great time for the rest of the country.

Happy Hunting.

[S13SilviaGirl]

Many are bank owned REOs others are listed well below market value attempting short sales. These can be great deals, but plan on investing lots of time trying to buy them. Now is a great time to buy if you have money, credit, and a very stable job. Not such a great time for the rest of the country.

Happy Hunting.

A lot of the REOs are going to cash buyers only. Sadly, the loans are being out done by lower cash bids (if I were the bank I would take the money upfront and run too). The short sales tend to take longer to process and get taken care of, whereas the REOs have only the bank to deal with. REOs also (typically) need a lot of work done to them...they are usually gutted ... at least in SoCal. The REOs in my opinion need more time in rehabbing than in actual buying process. If it is a cash offer they can have a house clearing escrow in 8 days now.

[WanganRunner]

Definitely tough to get REO assets in anything but an all-cash deal. Buy first, lever later.

There are loans on townhomes/condos, but expect to get less favorable terms.

[Matador]

A lot of the REOs are going to cash buyers only. Sadly, the loans are being out done by lower cash bids (if I were the bank I would take the money upfront and run too). The short sales tend to take longer to process and get taken care of, whereas the REOs have only the bank to deal with. REOs also (typically) need a lot of work done to them...they are usually gutted ... at least in SoCal. The REOs in my opinion need more time in rehabbing than in actual buying process. If it is a cash offer they can have a house clearing escrow in 8 days now.

Yeah, forgot to touch on the cash preferred nature of REOs. I would guess that most if not all are trashed to hell as well. If the OP wants to move to Detroit he can buy an REO property for like 1k :-/

[BustedS13]

we bought our house with 20% down, but could have done it with 10, and neither of us have great credit. of course, this was a year and a half ago

[SimpleS14]

The fact that you're in FL will have a bank look long and hard at your loan application.

Property is still devaluing and reliable tenants are hard to find.

You can still get a loan, just make sure you have a high credit score, a lot of savings in the bank and a low debt-income ratio (below .36).

[WanganRunner]

Yeah, forgot to touch on the cash preferred nature of REOs. I would guess that most if not all are trashed to hell as well. If the OP wants to move to Detroit he can buy an REO property for like 1k :-/

Detroit makes me LOL.

I work in Commercial property acquisitions at a private equity firm, and Detroit is generally regarded as an outlier to every major national RE trend.

In projections where it shows the normal 2-4% annual growth in market research data, there is often an asterisk that denotes "*all markets but Detroit", and in order to underwrite any deal in Detroit you have to use special financial models and assumptions.

Unlike the rest of the country, which is going through a down RE cycle, the conventional wisdom on Detroit is that it will shrink INDEFINITELY. It isn't considered a cycle, people think it's just going to shrink down over decades to being the size of a much much smaller city and then stay there. That's never happened in any other US real estate market, AFAIK.