Jamie Dimon: "If you are not fearful, you're crazy"

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Anonymous_IHB

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http://calculatedrisk.blogspot.com/2008/10/jamie-dimon-if-you-are-not-fearful.html



Jamie Dimon: The origination business, and I think it's true for a lot of people in the industry, Meredith, people have gone back to old fashioned 80% LTV, real verified income, more disciplined appraisals, and then in some areas they won't even go to 85% LTV because of expected home decreases so we are not at 85% in California, Nevada, or Florida we're at 65. So that's why it's down. I think it's true for us and everybody else. Almost everything being originated is eligible for Fannie Mae, Freddie Mac, or FHA. So therefore you have this great reduction. Obviously the quality of that stuff is going to be much higher.
 
If jumbo loans go to a 1/3 down requirement, there won't be nearly as many jumbos for sale. They will either hold off the market, get foreclosed, rent out, or move the price to conforming * 125% (i.e., 20% down at the conforming limit, $812,500 in LA in 2009).
 
Of course, I also read than Dimon said he would only finance 65% LTV in declining markets like ours.



So if you can come up with a 35% DP (~$300k), he will finance your $900k house
 
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