Point 2 and the National MLS - Let's Take Baco Our Business! : It's Cheaper to buy in Pennsylvania

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It's Cheaper to buy in Pennsylvania - And your credit score can be lower!

By: John Rainville
Friday, February 08, 2008 7:19 PM

WOW! What a crazy world we are living in! I just saw on Inman that MGIC has just givine Pennsylvania a THUMBS UP for buyers from New York and Maryland. Here's a link http://www.inman.com/inmanstories.aspx?ID=66049 to the article.

It says that MGIC has tightened the qualifying for mortage insurance in 30 markets, and our unfortuante border states New York and Maryland and New Jersey are being penalized. Buyers will need more money down and higher FICO scores to get the PMI. They will only need a 620 in PA but a 680 in the other markets.

Plus MGIC is increasing the LTV to 90% instead of 95%.

So all you folks in New Jersey, New York, and Maryland if you don't have a house to sell, you may want to come to PA and settle down! You'll need less money down, and be able to have a few dings on your credit, too!

What country? The powers that be,keep tigntening the credit and insurance requirements to the point of being absurd. Why not just PRICE in the risk, and give us 8% rates with lower FICOS. There has to be some financial whiz kid that determine what they need to price in the risk.

The average American doesn't care if the interest rate is 8 or 9% as long as they can GET a loan! That's 25 to 50% more interest rate as a PREMIUM.For cryin' out loud, they let the credit card pirates to "price in the risk" and THEN SOME!

HELLO Mr. Sanity are you out there?

How many of you have customers that would BUY A HOME TODAY if they could get the loan?

Would they care about the rate, if they could afford the payment?

So can't some "gee whiz" lender figure this out?

As always IMHO.

Comments

Member Since '03	Gary Szolosi said: John there are some things you said that made sense and others that were in the border. The lending practices of anyone should be universal. If it is PA, or LA it should make no difference. Credit is given on the promise to pay, why would it matter where I lived, I will or I won't. I find that I can get a loan for most clients if they have a reasonable credit score. If it is lower than most they will pay more in interest rates and require more down, if it is good less down and probably better rates. I believe that is how the system should work. Build your score, put your money ant risk, and then ask someone to put theirs at risk. What a great country! February 8, 2008 11:19 PM
Member Since '06	John Rainville said: Gary: I just don't understand how they are going to improve the situation without loosening the lending requirements. You can take the rate to "zero" but if no one qualifies it does none of us any good in the real estate market. There has to be a way to mathematically quantify the risk and price the loans accordingly. If an Insurance company can calculate a premium to insure an "actress' legs---surely, some lender can borrow that chap for a day or two to help them "price the risk". My point is, just raise the rates to what they need to be, and stop making it tougher for people to buy, sell or refinance. I for one do not believe that America's average FICO is 680 as some claim. We need money for young families and the starter home customers to get in to start the domino to move the market---this business cannot be maintained, sustained or revitalized from the top down. This is a bottom up proposition. So the economic strata that is most impacted by the wars, the fuel and food prices, is being futher impacted by the current lending environment that won't give them a mortgage---yet will let them buy a new "Escalade" or give them a credit card with a 23.9% interest rate to further pick their pockets and keep them from a better financial future. IMHO. February 9, 2008 8:24 AM
Member Since '07	Nate Covington said: John, in respect to the people who buy Escalades, you hit the nail on the head. We have people out here who have more expensive autos than homes. Talk about investing in a depreciating commodity. Those same people, alot of times don't qualify for a much nicer home but still can get into the auto for $1000.00 down. It is a viscious cycle, I guess? People tell me it is a personal choice, but I disagree. I think it is a matter of education. February 10, 2008 2:14 PM
Member Since '07	Nate Covington said: Gary, I agree that we have a great country, but I do think there is inequity in the credit market. I personally know people who have move from place to place and their credit scores flucuated, when the other factors (eg.income,job time, debt) have not. I do think the region you live in must be taken into account by the credit bureaus. I think many areas are biased. Maybe Pennsylvania is one such case? February 10, 2008 2:20 PM