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Wells Fargo launches 3% down payment mortgage

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Diana Olick | @DianaOlick

First-time buyers and low- to moderate-income buyers have largely been sidelined by today’s housing recovery.

The common cry is too-tight credit. Lenders have kept the credit box restrictive because they are gun-shy from the billions of dollars in buy backs and judicial settlements stemming from the mortgage crisis that they still face today. Now, the nation’s largest lender, Wells Fargo, says it is opening that box with a new low down payment loan — a loan it claims is low-risk to the bank.

“We are fully underwriting the borrowers, we are partnering with Fannie Mae to originate and sell these loans, we are ensuring the borrowers have an ability to repay and that they’re qualified for home ownership, but we’re simplifying things for the homebuyer,” said Brad Blackwell, executive vice president and portfolio business manager at Wells Fargo.

https://www.cnbc.com/2016/05/26/wells-fargo-launches-3-down-payment-mortgage.html

3 thoughts on “Wells Fargo launches 3% down payment mortgage

  1. This is a plan to combat the challenges with FHA mortgages and inspections. Most people don’t want to get involved with FHA mortgages for fear of mandatory inspection items that are required of the seller.

  2. How stupid is this? The market drops 3% and the deal is under water. This is even dumber than the kinds of things that were going on back in 2006.

  3. @11:22am: Not at all. All mortgages today are actually verified, unlike the pre-crash ones that were not. No more of all that lying on applications about income.

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