One of our biggest selling points in real estate sales used to be the buyer's ability to leverage a relatively small amount of money into a large and growing investment. But low down payment loans are becoming a rarity, now that lenders are becoming more discriminating with their credit.
Leverage is a good synonym for credit. It lets you lift more than you could with your own financial muscle. In 2007, 45 percent of first-time home buyers put no money down on their purchase, and the median home buyer financed a full 98% of his mortgage. But these generous terms began to fade in late 2007, and had nearly disappeared by early 2008. It's not wonder that existing home sales fell 13.2 in July over the same month last year, while new home sales dropped even more...by over 35 percent.
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