The real estate market has certainly become healthier and conducive to investment than it was previously. Records in the real estate sector have shown a substantial surge pertaining to the number of people who are looking to buy residential properties right now in the United States. Even though there hasn’t been a big increase in mortgage rates, it has been predicted that the number of people looking to invest in a new home will decrease.
The new mortgage rates have already started to affect the market, according to real estate professionals, who have predicted that getting a mortgage for homes will become harder in the coming months. Come the start of the next year, the mortgage rates will increase significantly due to the new mortgage rules which will take effect. The new rules by the Consumer Financial Protection Bureau will place restrictions on the amount of money you can borrow from mortgage lenders.
The Federal Housing Finance Agency will also place limits on the size of mortgages being made available all over the United States. Real estate experts are advising people to buy houses right now, since the newer rates and rules of mortgage will make it extremely hard for people to finance for a home in the coming months.
The newer rules are not going to favor people who are looking to borrow money for buying homes, and comes in response to the government reducing its roles in the mortgage market. It is expected that borrowers will dip into the private market for purchasing loans from lenders and private investors. This will particularly affect people who are looking to buy expensive real estate properties, since their borrowing power will be compromised and private mortgages for million dollar homes will only be available to a handful of consumers.
A spokesperson from the Federal Housing Finance Agency stated that the new rules will mean that more people will turn to the private mortgage market, which has been shut off since 2008 and may cause people who are borrowing money from lenders problems, since private lenders require a 25% – 30% down payment on all loans.
The sudden surge in the private mortgage market will also cause the interest rates to soar higher for private mortgages, which may see a further decrease in the number of people who are looking to buy a home. If you are in the market for a new home, now is the time to make your move, before the new mortgage rates and rules come into effect.
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