Oregon's Best Mortgage Web Log -
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Thursday, 12-08-2011
http://www.consumeraffairs.com/news04/2011/12/latest-mortgage-data-paints-more-hopeful-housing-picture.html

Consumer Affairs publishes a somewhat cheerier outlook on the mortgage market!

Considering all the doom and gloom that has surrounded the mortgage market over the past few years, this nearly optimistic outlook published by Consumer Affairs reads almost as a breath of fresh air.  The article correctly points out getting qualified for a mortgage purchase loan or refinance can still present a daunting challenge for borrowers with damaged credit histories and other qualification issues (a more and more common occurrence since the beginning of the economic crisis).  However, the benefits for becoming qualified at this time have never been greater - at least from a mortgage loan perspective.

As mentioned in the article, mortgage interest rates are at their lowest since the Great Depression of the 1930's.  For those looking to purchase new owner-occupied or investment homes; housing prices are also at their lowest level in terms of real dollars - at least in decades.  This second point has acted as a barrier for current homeowners looking to take advantage of today's low rates as their declining home values have left them without the equity necessary to qualify.  But there is another reason to be optimistic that the article didn't capture; new stimulus programs are being developed to deal with just that problem!

The qualification issue is the culprit in the sticky issue of mortgage market demand, or so Consumer Affairs argues.  If this is the case then President Obama has confronted it head on.  Beginning this month Freddie Mac and Fannie Mae will be rolling out new programs (HARP DU+) which take the equity trap out of the qualification problem.  Once these new programs make their debut it will be no more loan-to-value concerns regarding upside-down mortgages.  No matter how much your mortgage is underwater, at least you wont have to pay interest rates from the booming days of earlier.  Current interest rates on conventional 30 year fixed programs begin at 3.75%, with 15 year rates beginning at 3.125%.  Being as the lifetime interest paid on a mortgage is more than the house being financed;  many thousands in interest are saved by even a single point reduction to interest rate (often hundreds are shaved off the mortgage statement each month). 

If equity is no longer a barrier to qualification there may be even more reason to be optimistic about the future of the mortgage market then this article describes!

Check back with OregonsBestMortgage.com for updates regarding Freddie Mack and Fannie Mae's new additions to the HARP DU+ programs.
  

 

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