September 2007

In mid-August of 2007 the mortgage lending industry hit the brick wall of the monetary market’s adjustment to the risk of funding sub-prime loans. The adjustment, which had been widely predicted since March of 2007, was really not an adjustment so much as a cessation of lending. The difficulty for Wall Street was mixing sub-prime with prime loans in portfolios, and therefore not being able to really determine the value of a “package of loans”. That stark reality seemed to hit everyone at the same time, and the reaction was to stop lending. That led to a crises in liquidity in world wide financial markets, and central banks had to step in to “shore up” the monetary market’s so as restore confidence in the system. Following is part of the effect of the “Brick Wall”:

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When was the last time you were a tourist in your own city? For me that was yesterday. Thanks to the Downtown Denver Partnership and Ken Schroeppel, Urban Planner/Tour Guide. We boarded a bus for a 3-hour tour of Denver’s infill development projects. Yes, we took a whole 3 hours and never left the city!

OK, so touring on a slow moving bus, covering all too familiar ground doesn’t sound so thrilling? Ah, but it was. Learning about Denver and all of the Denver real estate projects in and around downtown is amazing.

Denver is a construction magnet right now. Everywhere one looks there is a construction crane or two in view! Actually I think Denver has the corner on the construction crane market, there can’t be any left in the rest of the country. [click to continue...]

In my last post, I talked about how the FHA loan is now coming to be a new force in the mortgage industy and is filling the void left behind by the “sub-prime” loan crisis. The FHA loan is great for many buyers and people that need to refinance but there are a few things to watch out for. In the Denver Metro where I do most of my business the FHA loan limit is $308,370. So if you are buying a $500,000 house and you have little or no money to put in to the transaction for a down payment, the FHA loan will probably not work for you. FHA sets loan limits according to the county you live in. A good FHA lender can easily look up the loan limit in your county if that lender is a FHA expert. [click to continue...]

As you may be well aware, the mortgage industry has gone through quite a bit of turmoil lately, the so-called “mortgage crisis” has changed the way that you can buy a home. In the late 1990’s and early 2000’s the mortgage industry got a little cocky and started thinking that there should be a loan for everyone regardless of their ability to pay back the loan. This attitude gave way to the creation of so called “sub-prime” or “non-prime” loans. [click to continue...]