If you’re looking to apply for a mortgage or refinance your current home, there are signs that the real estate and mortgage lending industries are on the mend. In fact, some experts have gone so far as to say that now may be the best time to get a mortgage, and that rates will only continue to rise from here. However, at this stage arguing on either side of the fence is primarily speculation, as there are some compelling reasons to think that the industry is indeed still on a downward trend. The following are the best arguments on either side.
Arguments that the Mortgage Industry has Recovered
Reports from nearly every area of the country that home prices are stabilizing are bolstered by the fact that some markets – especially the Pittsburgh mortgage market – were not only scarcely (if at all) affected by the housing crunch, but that properties and homes have been steadily increasing in value in these areas.
*Increase in contracts
The nation’s largest homebuilders are said to be reporting consistent increases in new building contracts, which also stimulates significant growth in a number of related industries.
*Increase in Building Permits
An increase in building permits in some areas mirror the reported increase in building contracts.
The increase in contracts and building permits may be directly related to the fact that overall the current housing inventory is low, in addition to the fact that credit from mortgage lenders is far more liquid today than recently.
There has been a slow-down in foreclosure rates in the US which has directly stimulated the low inventory condition currently being reported around the country.
*Properties Selling in Hours
As perhaps the biggest indicator that the market is recovering, many homes and properties are selling within hours of being listed – a result of the low inventory state which has significantly driven demand.
Arguments against a Current State of Recovery
*Release of Foreclosure Stays
Some mortgage lenders were involved in a multi-billion dollar class action lawsuit that prevented them from being able to foreclose on some homes in their portfolio. Those cases have reportedly now been settled, which means that the lenders are free to pursue the foreclosure process, which will ultimately “correct” the low inventory situation when those homes go back on the market.
*Large numbers Seriously Delinquent
There are millions of people who are seriously delinquent on their mortgages. Many are more than one year behind. This state of high-risk will almost certainly result in another slew of foreclosures, again adding more homes to the national inventory and keeping prices low.
The most reasonable assumption to make is that some of these “predictions” are accurate and some are not. It’s not really a question of whether the market has recovered or not. The housing industry is an evolving one and like most economic systems it goes through normal periodic change and fluctuations. Your personal financial situation is far more complex than someone’s opinion on the state of a variable and ever-changing industry. Call us now to find out for yourself, or take a moment to fill out our easy online application – you’ll be glad you did.