No substitute for Downpayment


#1

Last week I had my first applicant that had recently lost their house to foreclosure. Here were their circumstances. $28k income - he works 40hrs per week , she is a stay home mom. on 7-2007 they bought an house 30 miles from work with no $$ down and $700 month payment. They made 7 payments and now they are walking away. I don’t know how typical this story is, but this is clearly no tear-jerker.

I had a conversation with a man who has been in the MH biz(sales,parks, lending) for 60 years and I asked him about some note servicing tips - without hesitation he replied “Get a Big Downpayment” and paused he went on to say “there is no better indicator of how well a borrower will repay.”

Would anyone disagree? Does anyone have techniques that are effective in getting No/Low Downpayment accounts to perform?

Post Edited (07-30-08 06:59)


#2

This is such a personal business. I dont think one jacket will fit all buyers. We analyze each person differently. We will take a $500 down payment if the buyers dont have the $2000 we normally require providing they have a fairly clean credit and criminal report combined with a good work history. There is my infinite wisdom with less than 2 years of experience in the business. I have been told with time this business will make a tuff person out of you. I have met old timers who dont understand why I finance for quote “Those Type of People”