Posted by Doug Pretorius on February 26, 2004 at 15:18:54:
Big deal. GEMI has been doing 100% mortgages for ages. You have to have GREAT credit to qualify for these offers. This has never been my market of buyers, so it has had zero effect on my business.
In fact, this will make it EASIER to do deals because there will be more sellers without enough equity to pay an agent. Here’s the choices these sellers will have:
Sell through an agent for $200,000 and pay $10,000 out of their own pocket.
Sell through me for $210,000 and pay ZERO commissions.
Looming trouble for L/O in Canada. - Posted by Eddie(ON)
Posted by Eddie(ON) on February 26, 2004 at 14:25:13:
For all those who do L/O in Canada, the rules of the game are changing. The CMHC is allowing people to buy homes with borrowed money, even for the downpayment. Previously, people had to come up with 5% of their own, non-borrowed funds for the downpayment. Now, people can even borrow that money as long as they can carry the mortgage costs on a month to month basis. Doesn’t this render the L/O useless now? Or at the very least makes your market much smaller, like only catering to recent bankruptcies?
While I don’t operate in Canada, I don’t see where this should impact your business. We have similar state programs here (Maine), and it doesn’t affect us at all.The typical L/O candidate is usually one who can’t get financing right away. Loaning the down payment doesn’t make their financial situation any better; in fact it can make it worse if it increases their debt ratio by let’s say ahhh 5%. Under these circumstances the L/O is perfect if you work with them to help clean up their credit and use the program to make buyers out of them down the road. You can gt paid on both ends and in the middle.