at the current rates?
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Itâs actually not that much of sensationalism as youâd think âŚ
âThe situation is much worse for homebuyers who purchased with government-backed mortgages, with 25% of those buyers this year now underwater, according to the report.â
Meaning these buyers probably didnât have the traditional 20% Down payment. Additionally they probably didnât have sufficient income so theyâre more prone to being hit by slowdown in economy.
âItâs not actually markets that are seeing prices come down the most â itâs markets that are using more of this low down payment types of lendingâ that are most affected,"
Being underwater becomes a bigger problem when homeowners have trouble paying their debt â a data point thatâs also rising.
âYouâre seeing borrowers who took out mortgages in 2022 becoming delinquent earlier,â Walden said. âTheyâre stretched a little bit more, you see higher debt-to-income ratios, and youâre seeing this increase in early-stage delinquencies. That does become a problem if youâre delinquent,â he said.
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Can always refinance when the storm passes. At some point youâre trading potential equity against temporarily inflated borrowing costs.
Values might not even drop that much. Maybe in some superboom areas like Phoenix and Vegas.
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come on. you canât possibly believe this.
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Median home price of 300k at 3% is a 1200 mortgage. Can have a husband and wife making 15/hr and still cover itâŚ. Itâs not the same anymore with inflation. I donât see any issues with defaults coming⌠maybe for people buying now at 7%. But people locked at 3% will be fine for the most part.
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Forgetting PMI, real estate taxes, Home insurance, etc.
Looking closer to 2k.
Additionally, utilities, auto expenses, food, etc. Can take priority over mortgage when things get tight.
Mortgage defaults are one of the last ones on the scale to pop up due to all the protections in place.
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Agree with this. Unless you absolutely have to move, youâre not going to take out a new mortgage at nearly double the previous rates. The housing market will cool off because voluntary moves will slow down, but defaults should stay relatively low.
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Just got this from Better mortgage today will some interesting tidbits about rates dropping this week -
â loan applications surged by roughly 4% in response to this recent dropâ
â Rates are temporary. Homes are forever.â
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All these numbers are affordable for the middle class. Especially when factoring tax deductions. Mortgage payments include tax insurance pmi so def not forgetting about that. Median is the important number and itâs not bad at all considering average pay nowâŚ
The only people that may have issues are recent buyers and those that used retirements/ majority of savings to pay over appraised value. Lots of people the last few years upgraded so it was a wash, they sold their previous house high, and bought high. Likely making a decent down payment with gains.
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Like losing your job. Citi Group came out yesterday they expect 2 million job losses in 2023. Saying the recession wonât be that deep, but it will be meaningful. Forecast based on current Fed rate hikes. They went on to say if Fed doesnât pause hikes until it sees the contraction, a deeper recession will ensue(aka even more job losses).
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I just bought, but I feel at peace with my choice. I have never really been âhomeâ for most of my adult life, so buying never interested me. Then I started seeing increases in my rent every year (including in 2020 when the pandemic halted such things). I received a notice in August stating my rent would increase by $1,600 â I decided that day to buy, as my mortgage would be my current rent (not the additional $1,600) even at these interest rates. It made no sense to pay someone elseâs mortgage anymore.
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Is there any source for this? I am just looking around in tech with my fellow colleagues and it seems our income had been increasing (from 2019 to 2022) a lot more than inflation. Especially where the new hires in 2022 are earning 1.5x what the hires from 2019 are earning. Totally anecdotal observation but would love to see some actual data on this, especially for the tech industry.
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The thing is people have locked in low rates. They canât move out and rent cheaper like they could last crash.
So unless these people are moving for a new job, theyâre going to do everything they can to keep making mortgage payments.
Other situation, major layoffs and economic collapse. Govt suspends mortgage payments/evictions again. They already set the precedent.
I just donât see people en-masse walking away from their mortgages like they did last time, the situation is completely different now with inflationâŚwages are higher in almost every sector
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Tech has been the exception to the rule the past several years - but I think I read that the tech industry was only 2-4% of the total workforce? I expect with the recent crushing of tech that tide will start to slow down/shift back
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At least this time around there is an option of work from home that wasnât there for the masses last crash.
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Actually, with new higher standard deduction & SALT cap, these median payments may not give that much more tax benefit.
I agree that itâs not an alarming right now but this is an area to watch if layoffs hit middle, lower middle class.
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I hate click-bait articles!!!
This is what I saw pop up in my
And this is the articles
Which talks about stopping C-HR production onlyâŚ.
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Iâm no English major and am a non-native speaker, but doesnât this mean they are talking about halting sales and production of a car? As in singular?
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Grammatically itâs correct. But the title is intentionally misleading to induce clicks. It should be something like âToyota halts sales and production of HRV for US marketâ
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âŚfor copyright infringement?
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