Before anyone gets their scruff in a huff, I'm not practicing Real Estate, just wanted to grab your attention with a snappy title :-)
So here's the disclaimer: The contents of this post (and every post I make on this blog) are the opinions of the writer (that's me) and are my opinions, wholly my opinions (unless otherwise stated, er, written) and nothing buy my opinions (even though they may occasionally come across as law). (Also please forgive the use of parenthesis in this paragraph.)()
This entry is an amended re-posting from a posting that will hopefully soon be posted in a very nice blog entitled Seattle-Avenue, written managed and directed by Denice Rochelle Brameus. Denice, 10,000 thank-yous for including me in your blog (which can be found here or by pointing your browser to seattle-avenue.com).
So what the heck is going on in the mortgage world anyway? Well, I'm glad you asked.
While the vanilla Fannie Mae and Freddie Mac loans we often hear about have avoided any sweeping reforms, if the loan scenario didn't fit inside that 4x6 box the national 'credit crunch' actually has some bearing, much more so at least than the blazing headlines of bubble-bursting, spontaneously combusting real estate recessions.
“Huh?”
What I mean is, the nay-saying media’s spin on the national devastation in Real Estate values just plain doesn't apply to our local market! Can I get an "Amen?"
In contrast, the mortgage market has been affected more directly because the majority of lenders licensed in our state sell the loans on the national secondary markets. Because of this, our local loans are directly affected by the state of the market generally. There are exceptions to any rule but basically that’s how it works.
So if you're saying to yourself "What about this $1M condo, should I really be buying now?"
I don't know of a single savvy Real Estate investor who would let a 'right-ing' of the mortgage market get in the way of making a right decision, regardless of the price range. Ultimately that’s a question for your Agent -- if you don't have one I am happy to recommend one -- and if the answer is yes, then we sit down to see what programs are available.
Does financing look the same as it has over the past few years? No, it's changed and we're going to structure things a little differently than we have been.
That’s all I really have to say about that.
Speaking directly to interest rates, a loan that meets the ‘conforming limit’ (currently capped at $417,000) is generally at a [slightly] lower interest rate than a loan amount that is non-conforming (over the $417,000 cap). This difference in rate based on the conforming loan limit is an historic trend we have found ourselves following once again.
So to re-cap: The sky is not falling and the Greater Seattle market is not going to pieces.
Have we even considered the net job growth that is projected for the next ten years? The affect of that on growth for our state? The real burning question should be, “Where are all those people going to live?!?” Wouldn’t that be GOOD for Real Estate?
Granite Falls just may become part of Greater Seattle after all…
In all seriousness, those of you that are really in this market I'm sure are more focused on the value of your investment than on the interest rate (which is enough in and of itself for a separate article). If you're concerned about value, that's a question for your Agent; if you're concerned about that interest rate, it's time for us to chat. How about over coffee – I’m buying!
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