3 Signs the Mortgage Market Has Hit Bottom

After more than two years of misery in the housing market, the worst may finally be over.

A handful of recent developments in the mortgage market all point to an easing of lending standards, which have been onerously high since 2008. Private lenders and the federal government have reinvigorated the jumbo mortgage market, making bigger loans more available to more borrowers. And in general, would-be homeowners can now qualify for a loan with a lower credit score and make a smaller down payment – in some cases, as low as 5%. Those moves, taken together, mean that more borrowers have access to mortgages, a necessary precondition for housing to rebound.

“When you see those moves on the upswing, it gives you a hint of what’s coming later on,” says Chip Cummings, president of Northwind Financial, a consulting company for mortgage and realtor firms.

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