Is the Window Closing for First Time Buyers?

Many Lenders Eliminating No Money Down Mortgage Products

In the wake of a meltdown in the subprime mortgage market, many lenders have stopped offering no money down mortgage products. Now, more than ever, is the time for Congress to act by passing FHA reform legislation, which would provide consumers with a safe, and valuable no money down mortgage option. Federally backed home loans by the FHA have decreased consistently in recent years due to stringent down payment requirements and low loan limits. As a result, many consumers have been pushed into the subprime market, with attractive teaser rates and no or negative money down financing options. As housing prices have stagnated, and interest rates on these exotic mortgage products have readjusted, many of these loans have resulted in foreclosure, which harms the consumer, the lender, and the economy in general. Just last week American Home Mortgage which had over 7,000 employees joined New Century Financial, by declaring bankruptcy and closing it's doors as a result of offering too many loans that resulted in delinquency

Read NAR's position on subprime loans, and FHA modernization.