We had agreed to purchase another rental house and had a signed purchase agreement with the seller, but we had not arranged financing. Since we have other rental houses and since we felt that the bust wasn't too bad here in central Indiana, we didn't think financing would be all that different from the last several years. Central Indiana never really participated in the huge increase in home values. Thus, we didn't think there would be a bust.
Well, apparently the tightening of lending standards is hitting everywhere. We had talked to someone from Countrywide and it turns out that many of the loan products are gone. We were being offered products like 11.25% for 40% down on a purchase price between 100,000 and 120,000. Can you believe it? So, I guess we won't be doing anything for awhile except tuning up the personal balance sheet and waiting for the real estate/subprime mess to blow over.
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