Banking Regulators Might Tighten Down Payment Requirements

Not everyone has a 20% down payment for a home. It might be time to move forward with that home purchase.

How many buyers have 20% to put down on their potential home purchase? Here in the San Diego real estate market where prices can reach astronomical figures this could mean a substantial amount of money. Well right now there’s a debate going on whether or not to change how much will be required for credit worthy buyers.

This is a result of the loose lending practices that contributed to the most recent real estate debacle of the last few years. As a result of all of those loans made with little to no money and documentation of income the government is considering this change that could affect millions of potential credit worthy buyers. Do you think this is this a good thing or a bad thing for the real estate market?

Thought the debate over whether this new standard will be accepted by banks is yet to be determined. The due date for a decision on this is in April which is just around the corner. This is major change with large repercussion and depending on where it is you’re looking to buy a home this could mean having a large sum of money in order for a bank to extend credit.

The San Diego housing market is making a recovery and if this was to go into place we would see many buyers lose their opportunity to buy a home here in San Diego. A coalition of several consumer advocacy groups and real estate associations have voiced their concern that this could be a bad thing with serious effects on the overall housing market recovery.

In addition to new regulations on home purchases there are several changes being debated when it comes to home refinance as well as cash-out refinances. In order to qualify for one of these types of transactionsthe amount of equity a home owner would have to retain would change drastically. Bottom line is that it’s more than likely is an increase in the cost f attaining a home loan or home refinance. Whether this proposed changes goes through or not there’s one thing you can count on, there will be changes made to lending practices and requirements so this is more the reason not to wait too long to make the American Dream come true for you and your family. Let’s hope they make the fairest and best decision possible but I ask, why take that chance?

Prudential California Realty is ready to work for you! Victor Zuniga (619) 851-1078