The Bank of Willards and The Bank of Delmarva have new requirements when purchasing a home. The days of no money down, 5% or even 10% down are long gone too. However, their policy has changed so much it doesn't stop at their new 20% down, it gets even worse.
Now you will be required to put 20% down on the SALE price of any home you purchase. So what does this mean to investors. Well, if you're an investor that purchases homes to fix and rent, you're completely screwed. You'll no longer be able to buy a home as a fixer upper either, unless you're loaded with cash.
Let's say you buy a $200,000.00 home for $140,000.00 because it is in need of serious repairs. You are now required to put down $28,000.00 in cash just to buy the home. Let's say you'll need to invest another $40,000.00 to get the house livable again. That's $68,000.00 out of pocket for a home worth $200,000.00 in the right market.
While local Banks haven't suffered like the big boys in our financial crisis we're now living in, they have made it just about impossible for investors to use their services to operate. If you think things were bad in the past, well, they're about to get a whole lot worse.
Now let's look at the Real Estate Agent end of the deal. Will we now see false numbers in order to get their clients to qualify for the 20% down? Time will tell!
16 comments:
The Eastern Shore isnt going to make it. There are no jobs. When your home is a negative investment the American dream is dead.
Ethics and Realtors, now thats funny.
I would imagine the terms are different for "investors" and "developers".
It's all in who you know and who you are, just like it's always been.
The answer to your question in the last paragraph is a definite yes.
anonymous 10:08, that is absolutely untrue. The rules set forth are exactly the same for a home buyer OR investor. I know this because my source is one of those investors who was recently informed of their new rules passed on Wednesday.
This may present an opportunity for home ownershio to increase in Salisbury, especially through Salisbury Neighborhood Housing. I know that they offer foreclosure counseling services, but don't forget that they have a great purchase program for owner-occupants. Joe, an interview with them telling us what they have to offer would be very helpful.
Kudos to those banks.
Sincerely,
Salisbury single-family homeowners who want to preserve their neighborhoods from "investors" like Richard Insley
Salisbury Neighborhood Housing 410-543-4626
The vast majority of realtors are professionals who work hard and serve the needs of the public by helping them achieve home ownership. To say that a realtor would commit fraud by elevating the price is mostly ridiculous. There are some cases, as there always have been, where a price might be boosted to accomodate settlement costs, but that practice has always gone on. And the banks have always had a limit as to how much and how it would be spent. To imply that realtors are all dishonest and bankers are stupid is just wrong.
The commissions these realtors have gotten away with are a crime.
Well, I know of one particular one who has and has always used shady ethics from L&F...
Realtors are like Car salesman, will turn the numbers anyway they can to make a sale. MOST of them are not looking to help anyone but themselves.
I would expect as much from The Farmers Bank of Willards. It seems the new generation of management has forgotten how the old generation ran their bank....they are ridiculous
Shouldn't make a difference to you Joe, what with all your millions and credit score of over 800.
looks like to me the triad of greed! bankers, builders and realtards is crumbling down hope you guyz stuck a few bucks back during the so called boom.i see sears and walmart are hiring.
What's wrong with actually SAVING up to make a huge purchase? The problem with today's society is that there is no shame. "Gee... I wasn't a good steward of my money... I'll go claim bankruptcy..." Whatever happened to honest ethics, a hard days work, and saving more than you earn? It CAN be done - many things we pay for every month are a "want" not a "need." Air, food, clothing, shelter, and a way to work are needs. Cable, cell phones, and that BMW are wants.
9:10 I agree with you. The banks lent money to people to buy houses with no money down, because most couldn't save enough for a down payment. That was a big mistake. If you are not disciplined enough to save for a down payment you shouldn't own a home. There are more things to take care of with a home than just paying a mortgage. A child get sick, a car breaks down and unexpected bill. No money in savings to pay for these things and now they are in a jam.
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