Lenders Starting To Tighten..!
A: Wow! It's starting earlier than I thought. Check out this corporate email from an insider at Fremont Investment & Loan, a division of Fremont General Corporation (NYSE: FMT), published on Calculated Risk today.
Here is the corporate email published on Calculated Risks post titled, "Fremont lending Changes":
Sent: Monday, February 12, 2007 1:54 PM
Subject: PLEASE READ - IMPORTANT PROGRAM CHANGES at FREMONT
Importance: High
Due to general negative Industry sentiment, due to recent articles in the media, and the ripple effect to the secondary market, Fremont has made the difficult decision to speed up some changes that were set to take place later in the year. PLS READ BELOW.
2nd MORTGAGES ELIMINATED effective TODAY!!!!!
Any Prequals out there that are 80/20 or combo loans, pls contact me by email asap for new pricing, with an outside second if available from IBC or other lender, or as a 100% or straight one loan
AA CUT BACKS AND HUGE CHANGES – any files that have been priced on the AA program need to be looked at ASAP, pls email me and attach a copy of the prequal with 1003 and Credit
Note: Fremont is typically at the forefront when making changes to programs, I would urge you to expect our competitors to be making similar changes in the next few weeks. Fremont ’s goal is to be here for the long term, thankfully we are self funded with tons of capital and reserves….We will be here to close your loans.
Thank you for your patience and understanding in these tough times in the industry.
More Details will be communicated later today ... I apologize for the barrage of emails, but I wanted to make sure that everyone is aware of what is going on ...
Thank you.
Fremont Investment & Loan
UrbanDigs Says: If this email turns out to be the real deal, it takes blogging to a new level of providing true insights to readers about the changing funamentals of real estate investing. I love blogging and I love reading Calculated Risk. It adds so much transparency to real estate and gives readers an inside look at what is happening NOW in real estate across the country! These lending changes are inevitable and will ripple through to the bigger banks in time. For now, expect the smaller banks and sub prime lenders to start out with these tighter standards which ultimately restrict purchasing power. And if you forgot, read my post I wrote, "Credit Crunch: Tighter Loan Standards?", that was publised 2 weeks ago containing my thoughts on this very issue.
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