Mortgage Market is Tough

I have a friend that is looking to buy a house with an 80-20 mortgage. That means that she will take out a first loan for 80% of the purchase price, and a second loan for 20% of the purchase price. There will be no money down.

The rate on her loans was originally quotes at around 7% for the first and 8.5% for the second. The rate on the second has now gone to over 18%.

I've been reading about what's happening in the mortgage market. Here's some first-hand evidence of how it's directly impacting real-estate.