In Stephenville and Beyond, New Mortgage Rules Will Have Wide-Ranging Impact

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According to a recent report from Adam Van Brimmer of the Savannah Morning News, the Consumer Financial Protection Bureau’s new mortgage guidelines are tailored to prevent another mortgage meltdown. The CFPB rules prevent any more of the strange loan packages that contributed to 4 million mortgage defaults since September 2008. The CFPB was founded in 2010 as part of the Dodd-Frank financial overhaul. The rules ban high-cost mortgage products such as interest-only loans and those in which the principal balances grow over time, known as negative amortization loans. The CFPB also placed limits on products with large, lump sum payments due at the end of a term, known as balloon loans, and on underwriting standards for adjustable-rate mortgages and loans with “teaser” introductory rates.

The CFPB provides definitions for “qualified mortgages.” Ed Sibbald of the Georgia Southern University’s Center for Excellence in Financial Services said, “This is not a look back or a look at what’s going on now but what could go on in the future.” Under new mortgage underwriting rules established by the Consumer Financial Protection Bureau, lenders must verify a borrower’s finances in eight key areas:

  • Current, or reasonably expected, income or assets
  • Employment status
  • Monthly mortgage payment
  • Monthly payment on any concurrent loans
  • Monthly payment for mortgage-related obligations (i.e. property taxes, home owners insurance)
  • Current debt obligations, including alimony and child support
  • Monthly debt-to-income ratio
  • Credit history

These important guidelines should help home buyers in Stephenville decide upon which of those houses for sale might just be the best option for them. The streamlined and refined lending practices will also ensure that prospective buyers remain within the appropriate price ranges. From there, we can help you find the perfect house for sale in Stephenville that is in that ideal financial range. Drop us a line today so that we can help you begin the search.

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“Desiree Bridges went above and beyond to help us first time home buyers go through the, at times stressful, process. She constantly followed up on items and helped us stay on track, along with the bank and seller. Throughout the entire process she was professional, knowledgeable, and trustworthy. She took our complete lack of real estate knowledge in stride and answered every question. We never had to worry that something was slipping through the cracks on her end. And now we are satisfied home owners. Highly recommend and if I were gonna to buy another one I’d go with Miss Desiree again at Hayden Real Estate!!”