From the Who Knew You Needed To Know This? file:

When a loan is submitted to Fannie Mae or Freddie Mac, one of things that’s required is that the loan submission has to have a designation as to whether the property is located in a great (stable), good (soft), not so good (declining), or bad (severely declining) market.  According to lenders, this designation is a strong indicator of whether or not properties are holding their values, and goes a long way toward dictating minimum down payment requirements on certain types of loans.

According to the Office of Federal Housing Enterprise Oversight (there’s an oxymoron, huh?), the Blacksburg-Roanoke markets have been upgraded from a soft market to a stable market.  If true, in theory lenders should not be held hostage by market values when reviewing loan products with their clients.  Any local lenders out there that can confirm or clarify?