t appears, depending on how the economic recovery comes along, that mortgage rates could continue to increase. Rates have been on the rise for weeks, while earlier in the year, they were holding under 3%. Analysts believe that it would be a good time for borrowers to try and lock in low rates now, with the anticipation they’ll tick upward through the year.
When someone is buying a home and they’re going to use financing in the form of a mortgage, they need an appraisal to cement the deal. Before a bank is going to extend credit, they want to make sure they’re not giving someone a loan that’s more than the fair market value of the house.
One of a lender’s main jobs is to evaluate risk. If a lender looks at a loan application, what is the risk in making a home loan? How’s the credit look? Can the borrowers comfortably afford the new monthly payment? Is the property going to be owner-occupied or will it be a rental? How much down payment is involved? All of these questions and more must be answered before a final approval can be issued.
Earnest money is just one of the many terms to know when it comes to buying a home. It’s something you might initially overlook, but not understanding earnest money can create roadblocks in your process to buy a home once you’re ready to make an offer.
Freddie Mac's results of its Primary Mortgage Market Survey® shows that "The drop in mortgage rates is good news for homeowners who are still looking to take advantage of the very low rate environment. Freddie Mac research suggests that lower income and minority homeowners have been less likely to engage in the refinance market. Low and declining mortgage rates provide these homeowners the opportunity to reduce their monthly payment and improve their financial position."
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