Edit: I mean "Mortgage". I hate typos. You can't edit your subject line either.

We are in the process of buying a short-sale property - a second residence. The offer is currently in the black hole of bank review, so there's no time frame and no guarantee of success.

My question is, what is going to take precedence with the interest rate we will be offered? I have heard reports of "lowest interest rates in recent times", but with the reported lack of available funds for lending, how does that affect the rate?

Applying supply/demand to money supply, low interest rates are usually used to get people to borrow and spend - effectively increasing supply. But if the money isn't there to borrow, that's literally reducing supply, which should have the correlated effect of raising interest rates.

So what's it going to be? I could pose the same question to my mortgage broker, but I'd expect a slightly biased answer.

 

Uncharted waters for the moment. Any answer will be a guess until your rate is locked. I suspect rates will stay relatively low as we slide toward the cliff. Economy is not strong enough for rate increases.

 

good luck on the short sale; it's a long process...

 

Bank are very tight on lending money now. If one Bank says no, keep trying others. If you do have decent Credit and have the required down, you will get a loan somewhere.

 

Banks in Canada rasied they're rates on Friday. Our Condo market is going to tank up here in TO since we have a over supply.

 

Rates are still pretty good, but loans are definitely harder to get. This being a second (not primary) residence is likely to make things more difficult and rates a bit higher. However, if you have considerable equity in your primary residence and have a substantial (at least 20%) down for the secondary residence, you should be able to find a reasonable loan. Just don't expect rock bottom rates on the secondary residence.

 

my brother just bought a condo in T.O, hopefully it doesn't tank too bad.

 

I'm going with my boyfriend this coming weekend to look at a couple houses. I'm concerned he won't be able to get a mortgage because of the troubled times we are in right now, even though he has decent credit. This will be his first house, though, and it's taken me months of pushing him to go look at some places. It's just annoying that he finally found something he likes (he's picky), and now this crisis crap happens.

 

I think I found my answer:

http://money.cnn.com/2008/09/29/mark...ion=2008092914

Thanks mods for fixing my subject line.

 

Yes it is. We finally have an accepted offer. Not too bad: $71k, and the previous owner (according to public records) paid $225k.

 

Congrats.

 

Wow!! That's a price drop.

Patience paid off. Hope the rest of the process goes smoothly.

 

DAMN!!? Congratz.

 

Thanks. From what I can tell my searching public records, the previous owner was not too business savvy. He had eight properties just in that county. I would not doubt he overpaid on most of them. I've also learned he hasn't paid HOA or mortgage for a very long time.

I kinda feel bad for him, but he brought it on himself. His loss is my gain.

 

Holy crap! Where are you that you can buy a property for $71k? Hell, that's a down-payment on a property here in the DC area.

 

Maitland, FL. 2 bd condo. I've heard other units are going for around the same.

 

Have you run a title search on the property? Wouldn't surprise me if he also owes back taxes. You realize you're on the hook for all of the liens. Wonder if the HOA can be included as well?

 

Actually, we're finally all done with negotiating and are heading to closing. The first mortgage holder is covering the HOA and taxes. We had a surprise 2nd lien that popped up, but they accepted a lesser value, too.

Another surprise was that you have to provide 20% down on a second residence in FL. So, despite the scambling for the extra funds, it's going to serve us well, since we don't have PMI and we can pay the taxes directly instead of escrowing them.

 

WOW, thats low. That's about right though, with the economy the way it is, NOW is the time to buy, even if t goes a bit lower you cant beat getting a decent property for 71K. Flippin times are over, now its time for the long haul. Even here in central cali homes that were sold 3 years ago for 200K can now be had for bout 80k due to the forclosures & banks just trying to recoup anything.

If ou have good credit, & decent income dont wait any longer!

 

Nice deal man!