Optimistic Current Market Trends
Traditionally, mortgage rates have been very stable and non-volatile compared to other financial rates. However, due to recent market conditions, rates now change multiple times even in the same day. With all that said, rates are at historic lows and 2010 is one of the best times historically to get a mortgage. To take advantage of this unique situation, finding a veteran of the mortgage industry is essential. A mortgage professional can help you watch rates carefully and notify you when rate conditions are optimal to meet your desired financial goals.
Finding a good mortgage professional to work with takes time. According to Chasity Lousteau (Senior Mortgage Broker for American Capital Corporation of Los Angeles, CA), a good mortgage company can offer you products both in-house as well as brokering loans from top banks all across the county. Being able to provide a mix of services allows potential borrowers to have a better chance of getting qualified for a loan, as well as having more than one option to choose from.
The biggest uptrend right now in mortgage is that banks and investors are becoming more confident in the market. This means banks are now offering more products and in turn, it means potential borrowers now have more options. The most noticeable area where products have reappeared are for jumbo loans, which is determined by a loan larger than $417,000 or $729,000 depending on the county the home is in. With jumbo loans returning, it indicates that banks and investors are optimistic about the market and the timing is good for homebuyers.
The Importance of Pre-Qualifying
Good real estate agents and home sellers will require the buyer to have a pre-qualification letter before taking their offers seriously. Having a pre-qualification letter means an underwriter at a bank has evaluated credit and the overall financial package of a potential buyer. In turn, the bank has provided that borrower with a loan amount that they would be approved for.
Essentially, a pre-approval will tell a potential buyer exactly how much home they can afford and give them a starting point for everything going forward. In the eyes of a seller, a buyer with a pre-approval letter is a stronger candidate for purchase then a buyer who has not started taking care of their financials.
Plan Ahead and Avoid Buyer’s Remorse
Even in tough economic times, the conditions of the current real estate market make it a great time for new homebuyers to plan and purchase their dream homes. With home prices going back up, potential homebuyers should not wait too long if they are considering buying. Help yourself by not waiting until the last minute, and plan ahead with a qualified mortgage professional.
According to Allen Cravello (President of American Capital Corporation), in a survey of recent home buyers in the Los Angeles area, one of the top complaints from home buyers was they felt hurried through the loan process and didn’t feel they adequately performed their due diligence on their mortgage. Essentially, they experienced buyer’s remorse on the single largest financial purchase of their lives! To avoid this problem, start building a relationship with your mortgage broker the second you even start considering buying a home. Buying real estate is a large financial decision and therefore time and care should be put into finding a dependable and trustworthy mortgage professional to work with.
Chasity Lousteau is a Senior Loan Officer for American Capital Corporation. She has over 15 years of professional experience in helping clients in her specialty areas of: FHA loans, conventional mortgages, and high-down or low-down mortgages. She can be contacted at 310-252-7226.
You can listen to Allen Cravello and Steve Guilino on Mortgage Spotlight Saturdays at 3:00 PM Pacific Time on KRLA 870 in Los Angeles.
Listen to the podcast at www.mtgspotlight.com.