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Are lower income borrowers the answer to a stronger housing recovery?

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Mortgage Professional America | 04 Nov 2014, 08:16 AM Agree 0
RealtyTrac says past record origination levels won’t be back for years, no matter how much the industry expands credit. Here are five reasons why.
  • Jose L Valencia - Modesto | | 04 Nov 2014, 10:15 AM Agree 0
    The other issue I do not see being addressed in this article is the DTI relationship with the low income and the current house prices now. In the area of Modesto California now we can not help those lowered income people due to this fact. We must be able to increase there income and have more houses available at this low prices in order to see a change with those lower income people. How about lowering the MI for them? 1.35% fee for the monthly (yearly percentage) cost on mortgage insurance I think is where we should have a change that will be able to make an impact. If we look at an example of house that sells for $ 150,000.00 with 3% or 3.5% down, will this really make a difference on the decision of buying or not? But the but the $ 160+ MI cost will definitely make an impact on the decision or the possibility even qualifying for the mortgage. $ 160+ a month is a lot of money for the low income people to spend. Just look at it.
  • Micki Malecki | | 04 Nov 2014, 11:57 AM Agree 0
    Yes, the lower price range is were everything must start. Buying right now is cheaper than rent. There are a lot of nice houses in the sub burbs. If the young renters would realize this. Somebody should take out a add in the paper or something. I think it could help to integrate these areas too.
  • Graham Montigny | | 04 Nov 2014, 12:35 PM Agree 1
    I have an idea. Why not grant a 5 year deferment on all student mortgage debt and cut the interest rate in half for the deferred period when you buy a home and stay a home owner? We were just giving them $8,000 to buy a home a few years ago. This will help with the QM ability to repay and give the home owner a chance to increase their earnings while making a small cut in the cost of those student mortgages.
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