October 13th, 2011 · No Comments


BUY Invega ONLINE WITHOUT PRESCRIPTION, The first article in this series argued that a roll-back of Fannie/Freddie lending terms to where they were before the financial crisis was needed to prevent a second round of home price declines. Where can i buy Invega online, In addition to benefitting homeowners and the economy, this would reduce Fannie/Freddie losses on both old and new loans, kjøpe Invega på nett, köpa Invega online, Online buy Invega without a prescription, which makes it a requirement of responsible conservatorship.

This article and the one that follows will discuss a few of the many specific changes in underwriting rules that are needed.

Modify Rigid Affordability Rules

The post-crisis rule that every mortgage loan must be affordable to the borrower was a knee-jerk reaction to the excesses of the bubble period, when many adjustable rate loans to sub-prime borrowers were not affordable past the initial rate period -- usually 2 years, where can i buy cheapest Invega online. Where to buy Invega, The blanket affordability requirement that emerged is preventing loans from being made that are safe to the lender and useful to a borrower who can’t meet affordability tests.

Mortgage loans are distinguished from all other loans by their collateral, and for a long period in our history, Invega samples, Fast shipping Invega, lenders based their decisions only on the collateral value. Incorporating credit and income affordability into the decision process was an advance, buy generic Invega, Buy Invega no prescription, but making affordability an absolute requirement was a step backwards.

My web site article on mortgage affordability cites many different situations where unaffordable loans are in the interest of borrowers facing temporary problems. If the property value is sufficient, order Invega online overnight delivery no prescription, Order Invega no prescription, there is every reason such loans should be made.

Eliminate Income Documentation Requirements For Sterling Borrowers

The rule-restricting frenzy that produced the blanket affordability requirement also created the full-documentation rule. This abruptly terminated an industry trend toward increasing flexibility in documentation requirements.

As an example, before the crisis a borrower who could not document income but was top drawer in all other respects would have been approved under one or another alternative documentation rules, BUY Invega ONLINE WITHOUT PRESCRIPTION. The sensible presumption was that such a borrower knew more about what he could afford than the underwriter, ordering Invega online, Where to buy Invega, and in the unlikely case where the presumption was wrong, the lender was protected by the property.

Today, real brand Invega online, Online buying Invega hcl, such borrowers are being rejected out of hand. Because alternative documentation provisions were grossly abused during the bubble period preceding the crisis, purchase Invega online, Japan, craiglist, ebay, overseas, paypal, all of them were eliminated in the mindless frenzy of rule tightening. The blanket rule today is full documentation of income for at least two years.

If the cardinal sin of the bubble period was providing credit to the hopelessly unqualified, Invega price, coupon, Buy Invega from mexico, the cardinal sin today is denying credit to the exceptionally well-qualified -- most of whom are independent contractors. They are the “disadvantaged group” of the post-crisis era, rx free Invega, Invega gel, ointment, cream, pill, spray, continuous-release, extended-release, and their numbers are growing rapidly.

A useful if partial step toward sensible documentation rules is simply to eliminate the income documentation requirement for otherwise sterling borrowers. BUY Invega ONLINE WITHOUT PRESCRIPTION, Such a borrower might be defined as one with a credit score of 740 or higher, down payment of 20% or more, and payment reserves of 6 months or more.

Eliminate the Requirement For Appraisals on Purchase Transactions

In the current state of the market, the price at which a willing buyer and a willing seller agree to transact is a better measure of the true value of the property than an appraisal based on prior prices of similar properties. Because many transactions are not getting done because of faulty appraisals, buying Invega online over the counter, Invega trusted pharmacy reviews, it makes sense to eliminate the appraisal requirement on purchase transactions.

The traditional underwriting rule, that loan amounts be based on the lower of sale price and appraised value, buy no prescription Invega online, Invega from canadian pharmacy, had little force before the crisis because appraisals rarely fell below the price agreed upon by the buyer and seller. It matters a great deal now because the quality of appraisals has declined markedly, order Invega online c.o.d, Invega over the counter, and all too many come in below the price. When that happens, comprar en línea Invega, comprar Invega baratos, Invega for sale, the likelihood is high that the transaction will be aborted.

I have written about the decline in appraisal quality before. The number of transactions has declined markedly, order Invega from mexican pharmacy, Buy cheap Invega no rx, forcing appraisers to check the sale prices of properties that are much different than the subject property. The physical structure and amenities may be very different, they may be located further away where the market may be different, and the transactions may be foreclosure sales or short sales at concessionary prices, BUY Invega ONLINE WITHOUT PRESCRIPTION. Furthermore, purchase Invega, Australia, uk, us, usa, because of the structural changes in the appraisal market resulting from the Home Valuation Code of Conduct, appraisers are now being paid less per appraisal and invest less time per appraisal than was the case before the financial crisis.

Appraisals are unavoidable on refinance transactions where there is no market test of property value, buy Invega from canada. Buy Invega ONLINE WITHOUT prescription, On purchase transactions, they are a costly and unnecessary nuisance that can sabotage transactions, purchase Invega ONLINE WITHOUT prescription. Purchase Invega, Eliminating appraisals does not mean elimination of property inspections, which may still be required to assure lenders that the property has no major physical flaws.

Next week: more needed changes.

Jack M, comprar en línea Invega, comprar Invega baratos. Australia, uk, us, usa, Guttentag, now Professor of Finance Emeritus, purchase Invega online, formerly Jacob Safra Professor of International Banking, at the Wharton School of the University of Pennsylvania. Earlier he was Chief of the Domestic Research Division of the Federal Reserve Bank of New York, on the senior staff of the National Bureau of Economic Research, and managing editor of both the Journal of Finance (1974-77) and the Housing Finance Review (1983-89).


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