Mortgage Lending Trends: What’s in Store for 2019

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Mortgage Lending Trends in 2019

We are six weeks into 2019 and the mortgage industry seems uncertain. You may be asking yourself, “Should I buy or wait?” or “What are my options?” These are valid concerns but luckily, we’re here to help. Let’s explore three trends we will likely see in 2019.

A seller’s market forever?
Yes, we are still in a seller’s market which means most sellers have the negotiation power. When you take this and add in rising home prices, it seems like a bad situation. But things are changing. Real estate forecasts suggest that the number of available homes will rise in 2019 allowing for a possible shift to a buyer’s market.

More loans are being approved
There’s good news! Banks are still issuing more mortgage approval thanks to an ease in mortgage lending standards. Does this mean lenders are turning a blind eye? No! But there is a reason for the influx in approval.

The main reason is that Fannie Mae’s and Freddie Mac’s criteria are not as strict as they used to be­–especially when mortgage loans come from lenders. The result is a borrower with a high amount of household debt can qualify for a mortgage loan with less money down. An increased loan-to-value (LTV) ratio. An increased debt-to-income (DTI) ratio.

Mortgage rates
It seems everyone wants to know if mortgage rates will rise this year. Truthfully, it seems likely we will see a rise between 0.1% and 0.4% this year. The good news is that mortgage rates go up and down depending on how the wind blows and even if we see a rise, it will be slow.

Don’t be scared to get your dream home!

Need help understanding your options? Give us a call at 949-356-6400.

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