José July 9, 2008 Real Estate , Economics , Info-Buyers Visits: 23 View Comments Print this post Send this post Copyright Jose Ramirez

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If you're considering buying a property The Mortgage Reports. strongly recommended that you buy now or wait until after 2008 or perhaps 2009. The article states that obtain financing will be much more difficult and expensive. While I've written about this in the credit crisis in a short graphic and the article presents a cause and effect that I found interesting to share.

Mortgages more expensive

• FHA insurance premiums increase required at closing.
• FreddieMac and FannieMae require additional premium payment.
• The banks are getting rid of all loans with hint of risk.
• Wall Street has lost its appetite for bonds secured by mortgages.

Financing difficult

• Do not allow exceptions to the criteria for grant funding
• The standards for approving loans are much more stringent.
• The Fed is preparing to intervene again in the mortgage market (see: Fed Sees Turmoil deep into next year .)
• Wall Street fears the failure of other banks.
• There are far fewer financing products.

Credit crunch through 2009

The credit crunch is mounted on the estate. Just as the bubble was caused by the almost infinite abundance of credit, real estate regression currently mounted on crédto Back. This is spelled out in the brief history of the housing crisis.

The credit crisis seems to have bottomed. The New York Times detailing the outstanding problems of Freddie and Fannie as the tip of the iceberg in this article which I quote:

Fannie Mae and Freddie Mac are the nation's largest buyers of home mortgages, and Traditionally the Government's backstop for the housing economy ... Each of these "government-sponsored enterprises" has now lost more Than 60 Percent of Its market value this year. The declines, Along With a falling stock market and Growing unease about the Possibility of more Losses at big banks, Reflect a Growing Consensus Among Investors That the current housing slump will last longer, and more Provides Severe, Than Initially Feared.

But ... as it says The Mortgage Reports :

in the end, Still Have lenders to lend - it's What They Do. The show must go on, after-all.

So, Uncle Tom missing the roadmap, the banks Have Been Still trying to make it work. They're Still Issuing new mortgage loans to Applicants and they're Changing Their business rules on-the-fly as Market Conditions warrant.

However, it's Dangerous to drive Without a roadmap. Every now and again, one of the mortgage lenders right drives off a cliff. And Each Time It Happens, everybody else on the road slows down, And That trickles down from Wall Street all the way to Main Street.

Therefore, Until the path gets more clear for the banks, life as a mortgage Applicant should continue to TOUGH. It Will not Be Easier to get a loan in six months Than it is today so if you plan to buy "sometime soon", maybe "sometime soon" should be upgraded to "sometime soon".

It is that uncertainty is the enemy of investors and it's up to consumers to pay the costs they will impose on the risk. The risk remains vigilant on the economic horizon ahead and therefore, experts say, will be more expensive and harder to obtain financing. If you want to buy just do it.