Mortgage Brokers...... Banks are not lending
Why would a bank not lend money? Isn’t that their job? Aren’t they there to lend money? Well, yes and no. They lend money when the Fed gives them the money to lend. The problem is that for the last 8 years, mortgage bankers have been using creative financing to get people into these over priced homes. They came up with interest only payments to barely get the homeowner to qualify for a loan. They used 100% financing options to get people into the home they desired. The Fed is also to blame as they kept lowering the interest rates. Mortgage brokers were putting people into these 3yr fixed loans, which is the lowest interest rates available or even worse, these negative amortization loans which tacks on more principal to the end of the loan. These tricks work in an appreciating market, but the market is declining and people are being left out in the cold. More and more homes are going into foreclosure and there are a lot of people to blame. You must blame the home owner first for overextending themselves. Next, the Fed had a lot to do with this big problem. Next, the banks were going right along with it. And finally, the mortgage broker for their creative financing that has really hurt the industry as a whole. Now you will be finding that the banks are going to be holding onto their money and not lending it. Remember when there was the no doc loan? This is where you could just walk in and claim you made so much money without tax return docs? This really helped the self employed get loans. This will NOT be the case for the next 5 years. This means that if you are a mortgage broker, loan officer or agent, you will have an extremely hard time getting your loans approved. If you are getting paid by the number of loans you produce…..good luck. You might be better off looking for another career. I hate to be the barer of bad news, but you see the writing on the wall. I am not telling you anything you don’t already know. You may just be in denial. The facts speak for themselves. Get out and get out now. Go to an industry that is thriving in this market. For a sneak preview, follow me to a place where business is booming
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