The Real Story About the Availability of Mortgage Money

Great article from one of my lenders....

The Real Story About the Availability of
Mortgage Money

By Mary Baymler, President, Burnet Home Loans

I am sure that you have recently had as many questions
as I regarding the availability of mortgage
money. The current economic crisis has led many
in the public to worry about whether or not mortgage
money is even available should they choose
to buy a house. Statements from government and
commentary by the media have certainly played a
part in creating this perception.
So, what is the real story? Here at PHH Home Loans
it continues to be business as usual. Perhaps, because
that statement is so ordinary, it gets overlooked.
I would like to give you the facts so that
you can share them with your customers.
First, frankly we have access to more funds to lend
than we can actually use! Our warehouse facility
has a $350 million capacity. Given that most loans
cycle through the warehouse in 15 days, our group
effectively has access to $700 million a month! This
morning we were only using a fraction of the line.
I would say we have access to plenty of credit.
Second, mortgage product is widely available. So
far this year, we have sold loans to 21 different
state and national investors. Within our investor
group we still have more than 450 products to offer.
Furthermore, we constantly seek out new investors
and, just as importantly, they seek us out
to sell their product! It is important to remember
that we have the best mortgage customers
around, the purchase money borrowers who come
through Coldwell Banker’s doors every day. Our
investors recognize this fact and want to do business
with us.
Third, borrowers can still qualify for a loan. It is
absolutely true that today’s underwriting standards
are now stricter than those of the recent past.
However, that is a good thing for our industry. Borrowers
should be able to document their income,
their assets and prove that they are credit worthy.
Old fashioned? Perhaps, but it is certainly prudent.
Furthermore, PHH Home Loans was never a major
player in the sub-prime market. In 2005 when
things were getting rather wild and crazy, PHH
Home Loans did just 3.5 percent of our closed loan
volume in this category. It was never our stock in
trade and this has served us, and our parent company,
quite well. The marketplace is littered with
the wreckage of companies who choose the subprime
path.
Finally, as you know, this last weekend wrapped up
Coldwell Banker’s 10-Day Sales Event. This was a
tremendous opportunity for the consumer to get
into a new house. This is all the more true because,
as you know, interest rates have been moving
up for the last several weeks. It will certainly
do the consumer little good to hold out for that
last $5,000.00 on the sales price and then have to
pay a half percent or more on their interest rate
for the next 30 years. This may well be the best
time to buy!
As always, if you have questions, please consult
your Burnet Home Loans loan officer.