Many subprime lenders are closing their doors, making it difficult for many buyers to get loans.
Sellers now have one more thing to worry about when evaluating potential buyers, as many of the subprime lenders have recently closed their doors and more are expected to follow suit.
What does this mean to sellers? If your buyer has been approved for funding by one of the companies that goes under, then the buyers' loan broker will have to scramble to find a new company to fund the loan. In some cases this can be done in about a 2-week timeframe, and in others there are no comparable loans for the buyer to get into.
With buyers who are barely qualified for the loan program that they're attempting to get into, it can be difficult if not impossible to find another subprime lender to make the same deal. This means that your buyer can basically disappear with only days left before you are scheduled to close escrow.
A website that is attempting to track these lender closures is The Mortgage Lender Implode-O-Meter. While the information on the Implode-O-Meter cannot be considered 100% accurate, it does give a good idea as to where the subprime market is heading.
This site is sponsored by Linda Slocum of RE/MAX of Santa Clarita in Valencia. RE/MAX of Santa Clarita in Valencia does not make any representation or warranty regarding any information, including without limitation its accuracy or completeness, contained on this Web site.
