WASHINGTON - Foreclosures are a problem nationwide, but a new factor is contributing to the growing number of them in Prince George's County.
Under a new rule for condominiums, a potential buyer cannot get financing if more than 15 percent of the current owners in the building are behind on their condo fees unless they put 20 percent down -- not the 3.5 percent that some loans allow.
The nationwide rule applies with FHA, Fannie Mae and Freddic Mac loans.
But it's affecting sales in Prince George's County, an area already dealing with a high number of foreclosures.
"I would estimate more than 75 percent of the condominium buildings in Prince George's County are now un-financeable through traditional loans that we're seeing," Michael Chelst of America Home Key says.
"These are people who are first time homebuyers and looking to get in and using the 3.5 percent down-type programs and all of a sudden instead of needing $3,000 or $4,000 to get in, they now need $20,000 to get in."
Key says despite other programs that will help residents purchase foreclosed properties, new ones will continue to pile up even faster.
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2 comments:
No one should get a mortgage with less than 10% down.
9:39, glad you are not in charge. We are a young couple who thankfully have good paying jobs (making over $100,000 a year). With the current market, we're looking at homes in a development that were selling for over $400,000 (3 levels, huge finished basements, gorgeous master suites, 2 car garages) that are now selling for under 300,000 (our price range) with low interest and very little down. I'm loving this market!
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