OfflineIn March, Federal bank regulators proposed that mortgage lenders require a minimum 20% down payment on many home loans. The “law of unintended consequences” is being bandied about. After years of too lax lending regulations, some say that this is a gross overreaction and will result in a death blow to the housing market for years.
Opposition to the 20% down payment rule includes:
• National Association of Realtors®
• Mortgage Bankers Association
• consumer lobbying groups
• Center for Responsible Lending
• 40 members of the U.S. Senate
One quote illustrates their concern: “We are not opposed to buyers who can afford it making a 20% down payment on a home purchase. But we see no future in disenfranchising people with jobs and good credit ratings who want to buy a home but can’t meet the 20 percent test.”
The proposal is open for public comment until June 10, 2011.
More Sellers May Become Lenders
These economic and home price situations are going to bring more homeowners with equity to the point of making a lending decision. They’ll find that if they become the lender, they may be able to sell a home when nothing else will work. And, they may get more money for it.
Of course, first there needs to be more buyers out there. If there are buyers, there will be many who can’t meet down payment requirements, or have lower credit scores. While they’re prime candidates for seller financing, they’re also higher risk. It’s a tough situation for a seller, but it may be their only route to a sale if they need to sell soon.
are so screwed up right now its ridiculous. Some of their rules are so absurd. C'mon, I have a rental for 14 years and another for 7 years; both with no vacancies in that entire time (except the 14 year one for a 1 month light rehab) and because they don't have 30% equity any more all of a sudden my rents don't count? Oh brother! And then, some of them don't count my income on my newest property because I haven't had it rented for a year yet and it doesn't show on my taxes.
Way to go and punish the investor!
Here in Washington state, it seems like the Federal Bank regulations are hurting, rather than helping the realestate situation. The regulators definately have gone from one extreme to the other. First time home buyers,
. ) I know there is a silver lining out there some where with all of this, but sometimes I don't think the regulators (or the government)have a clue. (Either that, or they do, and they are still making tons of money anyway.) We the people need to work together to make things better and create good living wage jobs and get people back to work. Maybe we need to create new companies and rebuild manufacturing facilities to start making real "American" made products and growing American grown food products here in the United States again, to compete with all the companies that sent all thier jobs overseas. I know that With God's help we will come up with the faith, hope, ideas and solutions to make it through all of this.
I'll get off my soap box for now 
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or any home buyer, are haveing harder times jumping through the ever changing hoops to buy a home. The sale price of the homes are going down because of all the foreclosures, but the ability for a buyer to qualify is getting tougher and tougher. Some of the changes are good, because they help contracts to be safer and more honest, and more realestic, like they should have been before in the first place, but now the regulators are swinging way beyond what is needed. Not only are they making it harder for someone to buy a home, they are also making it harder for the seller to sell his home at a decent price and pay off his loan. To me this does not make any since. The banks should be losing money with this deal, too, but do not seem to care. I'd like to know what really is going on with the banks. (Or maybe I don't want to know
OOPS, I got carried away. Thank you for taking the time to read all of this.