Gulf Coast Associates' Blog: Lending News

The collapse of American Home Mortgage last week is making all the headlines. Over the past month or so, if you follow any type of financial news you've been hearing about the subprime markets, predatory lending, and the tightening of credit lending standards by State legislatures including Florida. What does all this mean to you? Let's see if we can explain a few of the details so you can understand what actually is happening.

In the past few years quite a few loans were made to folks using a "non-traditional" or a "non-conforming" loan product - this may have been for a poor credit history, unwillingness or inability to document income, or many factors that leave a borrower "outside of the box" for standard loan qualification. Quite a few times these…

For families facing some challenging housing arrangements - we announce the offering of the Family Opportunity Mortgage. Now, if you need to buy a home for a disabled (unable to work) family member, provide housing for a college bound child - "Kiddie Condos", or provide a home for your elderly parents - you will no longer have to pay the higher interest rates associated with the home being considered as an investment property.

For elderly parents or disabled family members, you will need to provide a letter stating their intent to occupy the property as their primary residence and if applicable, an explanation regarding the disability. There are no distance requirements and you will qualify as the primary purchaser on the property.

For "Kiddie Condos",…

With mortgage fraud continuing to rise throughout the country and the state of Florida ranking number one for its occurrence in 2005, Gov. Charlie Crist signed a new law last week intended to combat the problem.

Changes in lending rules will go into effect on October 1st of this year with the goal of making the mortgage lending process more transparent. Any person, including buyers, sellers and real estate licensees will be held accountable if they are caught knowingly lying, misrepresenting or omitting information a Lender would rely on in the mortgage loan process.

The new law requires the following lending practice changes:

• New more detailed disclosures for loans, including variable rate (ARM) loans.
• Mortgage Brokers must disclose to…