FHLMC recently announced that they would no longer purchase loans with LTV/TLTV/HTLTV's greater than 97%. This announcement affects all FHLMC products except Home Possible and Barrier Buster LPMI. Any FHLMC product that previously had maximum LTV or TLTV or HTLTV of greater than 97%, is now reduced to a maximum of 97%.
This means that Freddie Mac will no longer accept Zero Down loans. Buyers will have to muster up 3% or more to qualify for a home loan. So to get a $500,000 loan the buyer must pony up at least $15,000 cash.
I would say that this will put a damper on the market even more. Sellers will have to realize the higher their asking price the higher out of pocket cash the buyers will need. Some houses simply will not sell.
1 comment:
3% now soon to go up.
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