Clearing Up Some Misconceptions About New Mortgage Regulations

I keep hearing the same misconceptions over and over from people who think that recent regulatory changes to how people can qualify for mortgages are going to make it super hard for them to buy. At least a half dozen (smart) people have told me that they’re having trouble saving the 20% down payment they need for their home and that they’re annoyed that they have to stick to a five year fixed rate. Also, to a lesser extent they’re talking about not being able to refinance much of their homes.

Slow down. Relax. None of this is true.

It’s a grossly exaggerated and twisted impression of what is actually going on.

If these things were true it would be a huge deal for real estate markets and prices would probably plummet. That’s not what’s happening because the changes aren’t nearly as severe as all that. I have written about this twice on my blog before. Once when the changes were first announced and once I was able to wrap my head around it better and I found an article written by someone with more knowledge on lending practices than I. I highly recommend that you read that second one. It will put you at ease once you realize that there’s no real problem for most people.

If I were you, I’d keep an eye on what the mortgage rates are doing and get pre approved as soon as you can. The Mortgage Broker can almost always hold those rates for 90-120 days and as rates are starting to creep up, you might as well do it now if you’re planning on buying soon.
Now read that earlier article. In fact, while you’re at it you might as well have a look at my year end “best of” lists like this one and this one. They’ll basically make you understand that although real estate is very complicated, the essential strategies are simple. For navigating the details… that’s why you have Realtors like me.

Ryan Coffey

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