Interest rates appear to be staying put until the US economy gets back on track and stays there. This past week Ben Bernanke, chairman of the Federal Reserve, announced his desire to keep interest rates low due to the fragility of the economy. Unemployment figures are continuing to rise. These increasing unemployment figures are interfering with recovery and affecting real estate and general sales figures across the Country.

Historically low interest rates and low home values combined with the extended and expanded First Time Home Buyer Tax Credit, have been instrumental in boosting real estate sales in the United States. These incentives are bringing buyers off of the sidelines and have created a true “buyer’s market”.

Real estate is typically a catalyst for for economic recovery and keeping mortgage rates low will be a significant help in keeping the sales coming.

Click here to see a recent article about Ben Bernanke and his commitment to keeping interest rates low.

Finding a mortgage before looking for real estate is a smart idea

The first step in purchasing real estate should be getting a mortgage.  Getting a mortgage, or rather getting approved for a mortgage, lets a buyer know what he can expect to afford when looking at property.  It is important for a potential buyer to know how to secure a mortgage.

There are any places to look for a mortgage these days.  There are banks, mortgage brokers, finance companies, credit unions and private lenders.  Often experienced Realtors have mortgage brokers or banks that they work with often and using a lender that has a good reputation is often a safe bet.

When looking for a mortgage have a good idea how much you can afford to pay each month.  Look into the past, present and future to determine this.  It is of the utmost importance not to bite off more than you can chew when it comes to your finances and the affordability of a home that you might buy.

When applying for a loan a person must provide documentation of income, expenses, and assets.  Have your financial statements and tax returns ready and the process will be much easier.

Having a mortgage ready to go before finding a property will make the entire process smoother.  Financing is harder to get these days and being prepared is a wise step in the home buying process.

For more information on mortgages click here.

Low mortgage rates are doing the job to make real estate more affordable

Keeping mortgage rates low is helping to stimulate real estate across the Country.  For the past few months the public and private sectors have been putting their heads together to get our Country out of the mess we are in and real estate and lending have been the primary focus.  The lowering of mortgage rates and keeping the interest rates low has been playing a major role in turning real estate around and getting potential home buyers off of the sidelines and into property.  Low mortgage rates are helping keep the cost of buying real estate low, enticing people to buy property.

Mortgage rates have been holding at historically low rates.  The current average rate for a 30 year fixed mortgage is 5.12%.  The average rate for a 15 year fixed mortgage is 4.69%.  A recent article at Realty Times points out “Low rates contributed to existing home sales rising for the fourth consecutive month to an annual pace of 5.24 million in July, the most since August 2007, according to the National Association of Realtors.”

There is a drive to continue to keep mortgage rates low as the low rates appear to be doing the trick as the real estate sales volume continues to increase across the Nation.

For more information about mortgage rates visit Realty Times by clicking here.

***Beginning January 1st, 2009 the new FHA loan limit will be $271,050 and the new downpayment requirement will be 3.5% of the purchase price.

Conforming 30 yr. fixed – 5.125% (assuming credit score of 740…rates may be higher for lower credit scores – rates are quoted with 1% orig.)

Conforming 15 yr. fixed – 4.75%

FHA/VA 30 yr. fixed – 5.375%

As always if I may help you or your clients in any way please feel free to call on me at your convenience. I look forward to the opportunity!