Can you get approved if market crashes?

Question

Anyone know if you could get approved for a load of if or whenever the next market crashes?

Steve Vaughan · Answer

During the last recession, none of my lenders had an appetite for commercial multi-family anymore,  no matter how good the buyer's credit profile or how large the DP.

Residential loans were available, just tighter standards like Chris mentions.  Tougher still for condos, manufactured, row/townhomes, etc.

Either way, I wouldn't put off shopping until the fall thinking homes will be cheaper.  Stick to your criteria and buy if something meets it. Always a good market if buying value.

Andrew Postell · Answer

@Juan Carlos Garcia this might be a little difficult to answer because....will you have a job when the market crashes?  Will you have assets?  Will you still have reasonable credit?   Don't get me wrong here, PLENTY of investors have made it with NONE of those things.  The last housing downturn we was a great time for investors.  We purchased home at rock bottom prices.  If you speak with an investor ask them if they want a buyers market or a sellers market....and they will say a buyers market every time.  Because we can then pickup properties significantly more easier than in a seller's market.  The important element is do you know how to adapt to either scenario?  Networking is always important in the business.  I always recommend people to know 4 different lenders because things change....and sometimes a property may not fit one lender...and things change in down times too.  Just keep that network growing and you will find ways to be approved no matter what the market shows.

Chris Mason · Answer

No one has a crystal ball, but generally lending and credit will get tighter when creditors get more conservative in response to market conditions.

Justin Kane · Answer

cash is king in a down market

Saravanan Saravanan · Answer

@Juan Carlos Garcia

As long the cash flow makes sense with factoring in for vacancy, taxes, insurance and maintenance; then you can invest in the property.

It is bit challenging to predict the exact time for the market correction.

Also, some areas may drop more than the others; as part of it depends on the areas employment rate and vacancy rate of the rentals.

Juan Carlos Garcia · Answer

@Chris Mason oh I see what u mean. Got any advice if I should save my money I have right now for a 20% down or wait a little longer maybe by the end of summer or end of the year to see if houses keep dropping to purchased my first rental home?

Can you get approved if market crashes?

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