>
This morning, I was talking to one of my Investors and he told me something that I was kind of expecting but was truly hoping wouldn't happen. "Broker Bryant, I spoke with my bank this week about placing an equity line on one of my Poinciana properties and they said they couldn't do it. They aren't lending money in Poinciana right now."
Let me repeat that, "They aren't lending money in Poinciana right now." There it is, in plain English. I knew it was coming....but damn....I was really hoping it wouldn't be so soon.
Sub-prime is almost impossible to get. FHA is clamping down on down payment assistance programs and now some banks have decided not to write loans in Poinciana!
If you read my post earlier this week, "Poinciana is numero uno baby!" you know that Poinciana has the highest mortgage default rate in Central Florida. Now, to add insult to injury, we can't get mortgage money!
Folks, I'm a very optimistic person and I always move forward but....I must say, it's starting to feel like I'm pulling a train through the mud with my teeth! What are my poor Sellers going to do? What little equity they have left is disappearing and now it's only going to get worse.
Qualified Buyers are going to be holding all the cards. For a Seller's Broker, like me, that sucks! My Sellers, that really need to sell, are going to be forced to consider any crappy offer they get. If we turn them down we may not see another one for a long while.
Oh well, what you goin' to do? I guess I need to brush up on my USDA Rural Housing loans. There was a time, about 8 years or so ago, when "Farmer's Home Loans" ruled in Poinciana. It's a pretty good loan. You can do 100% financing and you can put the closing costs in the loan. I don't think it's credit score driven either. The only quirk, that sometimes poses a problem in Poinciana, is that the property can't be in a flood zone. Also, no pools and no jalousie windows are allowed.
Now folks, I don't do loans but I do need to know if my listings qualify for certain programs or not. Just because I rarely work with Buyers doesn't mean I don't need to know this stuff. So, I'm off to the USDA website to do some studying.
Times are difficult. That means, it's time for me to get better at what I do. It's really the only option I have. Real Estate is what I do and my Sellers need me to "up my game".
So, for all you Buyers out there. If you are looking to live in Central Florida, values are down and you don't need any money to buy a home in Poinciana Fl. All you have to do is contact Broker Bryant. I'll take it from there. Are you dialing yet?
All content copyright © 2007 - Broker Bryant Real Estate Ramblings
Reserved Parking For "The Lovely Wife"...TLW...ROAR!
Blog Boy...
What am I going to do?
I am going to ask them if they're dialing yet :)
TLW...ROAR!
This too shall pass. It's not easy for any borrower these days.
Florida, in general has had some serious mortgage default issues.
It'll get better, and you know it!
BB,
Hey..send your overflow to me:)
Exclusive buyer agency -- how about tweaking your business model and start courting those qualified buyers who are sitting in the catbird seat?
"So, for all you Buyers out there. If you are looking to live in Central Florida, values are down and you don't need any money to buy a home in Poinciana Fl. All you have to do is contact Broker Bryant. I'll take it from there. Are you dialing yet?"
BB, What exactly does that mean?
Jon, That means houses in Poinciana are cheap. I can get you a 100% Rural housing loan. And I'm waiting on your phone call. back in the "old" days dailing meant make a phone call. I guess I should have said "texting" :)
WooHoo.......no money for you!!!
Jay, It'll be OK. Poinciana has never been an easy market. Out of 14 years selling out there we only had about 2 that were easy. I'm used to it.
Andrew I truly don't have the patience to work with buyers. I do have a very good buyers agent though that can help them.
Neal, Overflow is one thing I don't have. Yet!!
Hey Mott good to see you.
Laurie, Luckily for me I like a challenge. I work better under pressure.
Hey Hun, I know.....quit shopping:)
Randy, It is redlining. But as long as it's not based on a fair housing issues banks can certainly decide not to lend in a high default area.
Thanks Marlene. To me that's always the solution. The solution is within us. Always has been and always will be.
Hopefully, your investor was working with a mortgage broker who lost his Florida resources.
I've never been in a home in Florida that didn't have jealousy windows.
Bryant,
I had a loan in underwriting, great scores, plenty of income low DTI, the home appraised for 30k more than purchase price...was submitted as a Fannie Mae loan and we get a response that since the home fell in an area described as a "Declining" market, the buyers needed to put 5% down. I was like HUH?
Sean Allen
The Mortgage Professionals
http://www.hawaiidala.com/
I spelled it wrong...it's dala not dalla.
Very Tough Situation!
<a href="http://www.regkehler.com">Winnipeg Real Estate</a>
Minneapolis is hurting but I haven't heard of this extreme, yet. Hopefully it doesn't get too bad...we are building a home right now.
I echo Sally's comment...
What kind of window? Juicy? Jalopy? Huh??
(My graphic says juneberry, is that what the window is called??)
Bryant,
I have a great big feeling that you aren't the type to put all his eggs in one basket. Get better at what you do. There's nobody else more qualified to help the buyers and sellers in your area, remember that.
Not only are jalousie windows not energy efficient, they're not good for security, either. Mostly found in older homes, i.e. the 50s.
BB - is it just investor loans that are no longer available in Poinciana, or also loans for primary home owner - occupants?
I'm thinking about buying a home in Florida. Heck, it might be the right time!
BB,
OMG, and people here (So Cal) thought they had it rough, ha. I've only had one time while in r.e. (too far back to remember, somewhere in the 70's) that I was concerned, when loans dried up in our area too. It was the one and only time I was concerned about my livelihood (mortages payments, feeding the kids,... things like that) and it was over limited financing.
You have absolutely the right attitude about "getting better at what I do" no doubt you and those you represent will get through this too. It's just part of the current cycle and there will be something else new in a few weeks.
And thanks for the tutuorial comment on windows, that one left me cluless too.
Bryant,
I'm not familiar with your area but sure hope there is a light at the end of the tunnel really soon. Things are tough everywhere. Can't help but wonder what the next Fed move will bring.
I bet you can't even remember the last time "I shopped at will" :)
I am very sorry to hear all of this. There has GOT to be a light at the end of this tunnel - and hopefully that light is not just another train to pull through the mud with your teeth.
I'm wondering if this is going to happen in other hard hit markets.. reminds me of the early 1980's when rates were so high.. if you didn't get funded by mid week you had to wait until the next week as money was available on a first come-first served basis. I can see that happening again in markets with high prices as jumbo loans are still tight as well as in markets like yours that have a huge number of foreclosures.
Makes me wonder if credit markets are gaming the system to cover their collective behinds while they wait for the FEDS to bail them out..
Hey guys, I guess I stayed away too long and now I have way to many comments to do the individual reply "thingie" but let me see if I can answer the questions posed.
The bank that is not writing loans in Poinciana is a large local commercial bank. They are writing "portfolio loans" and they just don't want to hold paper on a depreciating asset. It's understandable.
Red lining, whether legal or not, is certainly alive and well. I'm not an attorney but don't see anything illegal about it as long as their decision is not based on not loaning to a protected class. But if an area has high foreclosures rates and rapidly declining values lenders should certainly be able to make the decision not to invest money in that area.
My Investor owns well over 100 units and is not a marginal borrower by any stretch of the imagination. I'm pretty sure the bank will bend in his situation and do what he wants. He hasn't pounded them on the issue yet but will.
I wrote a post last year about appraisers making downward adjustments in Poinciana because of our declining values and it create quite the discussion from folks that didn't believe appraisers could do that. Well they can and do.
Folks my market is getting more and more difficult every day. It really is frustrating. I have so many sellers that are in dire straights and I feel like my hands are tied. I just hope they can hold on until things change. And they will change.
I'm hoping that since are values have dropped so drastically and so quickly that we may also recover quicker than other areas. There are starting to be some very affordable homes in Poinciana. Poinciana has always been a good place for first time home buyers and the way values are declining it will be affordable gain real soon. My biggest concern is the lack of 100% mortgage money. Poinciana is a working class neighborhood and folks need 100% financing and/or down payment assistant programs in order to buy. My market was rolling right along until the end of March when the sub-prime market hit a wall.
My last 3 closings were with FHA and down payment assistance. I felt this was going to fill the void for awhile. Now I hear that too is changing on November 1st.
That leaves "Rural Housing". The population of Poinciana is 68,000 so I truly don't know how that will affect rural housing in the near future. I'm not sure if USDA has population limits or not. I don't think they do but I could be wrong.
One thing is for sure, TLW and I will be fine. We've been here before and we do have other irons in the fire. Life is good!!!
We really appreciate all you guys stopping by and giving us your support. Thank you!!!!
I thought you may find this intersting. I wrote this last October:
http://activerain.com/blogsview/15045/Let-the-games-begin
Bryant, I remember it got really bad in DC in the mid-90s. We had just elected a crack head felon as our new mayor, and some idiot was driving around my farm area shooting folks. In the same neighborhood, there was a bit of rioting. It was not pretty. And it turned around. By then, I was so focused on buyers that I was not ready for the payback I got from all of the listing agents who stuck it our. They're the ones who got the 80 offers on each listings.
I think the Florida market has to start doing well soon. All of us boomers up north are worried about slipping on the ice and breaking a hip. We'll be moving down soon! It'll get better!
Patricia, Come on down!!! Are you implying that Barry was a crack head? :)
David, As bad as it is I do think the market needed to adjust. It was ridiculous when a starter home in Poinciana cost $225,000+. I agree it is nice that folks can now afford to buy again.
Hi Rebecca, I haven't seen a USDA loan in about 5 vyears but I'm sure I'll be seeing a lot of them now. It is a really good product. Plus I LOVE steak so can't go wrong:)
Maybe we can send some good karma your way, from up here in the Washington, DC Metro area. It isn't nearly so awful here. When I read your posts about your market area, I always makes me want to slap some whiny crybaby agent from around here that just doesn't "get" how good they've got it!
We're good to go Babe :)