Borrower Traits Highlight Mortgage Market Differences

Posted by  on Apr 20, 2009

Low mortgage rates have created a sort of silver lining in today's economy for some homeowners. By sitting out the overheated real estate market of the past decade, prospective home buyers in some parts of the country have learned how to lock in low monthly payments with help from eager lenders and brokers.

California Buyers Enjoy Relative Bargains
Rampant speculation drove California home prices to record highs during the 1990s and early 2000s. Thereafter, the state experienced some of the sharpest drops in real estate values in the country. Some borrowers' inability to make monthly mortgage payments have created relative bargains for home buyers in the region. According to recent news reports, as many as 60% of recently sold homes were in foreclosure.

According to many California brokers, prospective homeowners with secure jobs can use employer assurance and federal assistance to qualify for low interest loans. Pre-qualifying for a mortgage allows buyers to participate in bank auctions and other post-foreclosure sales. Borrowers who intend to remain in their new homes for five years or longer can expect to enjoy the maximum value from today's market.

Pennsylvania Mortgage Rates Reflect Market Stability
Few parts of Pennsylvania experienced the wild real estate market swings of the last decade. Therefore, many homeowners in the state are well-positioned to upgrade to larger homes or to refinance existing property under today's low mortgage rates. New condos and assisted living communities around Philadelphia and Pittsburgh appeal to retirees with significant equity from family homes.

Heavy competition for these high-quality home loans have pushed interest rates in Pennsylvania lower than the rest of the United States. However, brokers and lenders in the state advise that waiting for PA mortgage rates to drop further may be a mistake if you already know where you want to make your purchase. By running your current income and today's rates into a mortgage calculator, you can get a clear picture of the amount you'll need to set aside each month for your payments and expenses.

On both coasts, experts note that the days of casual house-flipping are behind us, since lenders have refocused on building quality mortgage portfolios. Now that the real estate market favors long-term ownership instead of speculation, relationships with the best mortgage lenders are crucial to getting good rates and terms. Experts recommend that you request quotes from multiple banks and brokers before home shopping, so you can understand the kind of property that will fit your budget.


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