Recently, I posted a newsletter that talked about declining market guidelines. As further proof of the turbulence in our industry, just a few days later, that information is now invalid! Late Friday it was announced that Fannie Mae has responded to consumer lobbying by removing the 5% loan reduction for “soft market” properties. This puts a lot of home buyers in a better position, but not them all. Most lenders will not act immediately to remove this guideline from their own rules simply because Fannie Mae has indicated that it is ok. Freddie Mac has not responded yet with their own update to the policy, but I would expect to see a similar move shortly.
So…to sum up, forget what I told you all last week, because this week it’s different. Welcome to real estate financing in 2008 J.
--Keith
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