Will First-time Homebuyers Make A Comeback In 2015?

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Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
Jan 14, 2011
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San Diego, California
www.loansreduced.com
We have seen rents rising dramatically and in many cases faster than incomes. Many millennials will now be looking to purchase a new home on their own.

There’s a few things that have changed recently that many first time homebuyers are unaware of:
  • Lower down payment options available
  • Looser lending standards
  • Bigger selection of homes to choose from
  • Home Prices will become more affordable
  • Mortgage rates will move higher at some point

With these new changes there are a few things to know if you’re a first time homebuyer.

Lower down payment options available: Fannie Mae has just released a new program to allow people to purchase an owner occupied residence with only 3% down! FHA currently has a 3.5% down payment option and both of these can be combined with down payment assistance depending on if you qualify.

Articles of relevance:

Fannie Mae & Freddie Mac Changes 12/1/2014

Looser Lending Standards: If you have had a previous economic event in the past (ie: bankruptcy) there are still options available if you don’t meet the waiting period requirements that Fannie Mae, Freddie Mac & Ginnie Mae have put in place.

Articles of relevance:
New Home Loan Program for Borrowers with Previous Economic Events:
Refinance Out of a Hard Money Loan

Bigger selection of homes to choose from: Now that the Chinese & Russian investors have for the most part backed out of the US Housing market we will see more homes available and less of a bidding war to get your new dream home.

Home Prices will become more affordable: With the cash investors slowing down, the market will open up and we should start to see home values drop and become more affordable. If you currently own a home and are looking to refinance but may owe close to what the home is worth – look into it now before your home drops in value.

Mortgage rates will move higher at some point: This is inevitable, we can’t continue to see 30 year fixed rates in the 3%’s and the bond subsidization will continue to diminish which will eventually result in higher interest rates. We don’t expect interest rates to peak as high as they did in 2014 at around 4.75% however all economic data points to a potential increase up to 4.5%.

Of course we don’t have a crystal ball and these are all speculations. I have been in the industry for quite some time and when the writing is on the wall, it’s very easy to read!

If you have any questions please feel free to reach out to us here at LoanSafe.org or by phone at 800-779-4547 we’re always happy to help.