Michele's Blog

Have We Reached the Bottom?

June 4th, 2008 3:23 PM by Michele Morse Reen

Dear Clients, Friends and Family,
We continue to have an interesting real estate market, to be modest.  Earlier last month the Fed lowered the Fed Funds rate another .25% and likely will be the last lowering for the year (remember, when the Fed lowers the Fed Funds rate, it usually means rates tend to move a bit higher because it sparks inflation concerns).  The Fed has been caught between a rock and a hard place because they have to walk a tight rope of trying to prevent a full blown recession while staving off inflation (by the way, mortgage rates hate inflation and tend to rise in that kind of climate). 
On the bright side, clients are starting to take advantage of the lowered home prices out there and either buying bargains right now or seriously starting to look.  In my opinion, right now is a once in a lifetime opportunity to take advantage of homes that have had severe drops in price while taking advantage of still historic lows in rates.  These current buyers are understanding the benefits of not waiting.  Their stance is why try to squeak out a bit lower price when things are already very affordable.  Besides they don't want to run the risk of higher rates and/or tighter lending guidelines down the line.  Bottom line:  It's worth looking into now. 
FHA or Federal Housing Administration loans are back in vogue with the raised lending limits to $729,750.  These loans are not just for first time homebuyers and have some wonderful features such as 2.85% down payment (can be 100% financing with assistance programs), non-occupant co-borrowers to help qualify, all gift acceptable for down and closing, seller help with costs, and 580 and up credit scores just to mention a few.
We are one of the few brokers in the area that are currently FHA-approved, and we have already completed a number of FHA loans for clients!
If you have questions or are interested in exploring your options further, don't hesitate to call me.  I hope to hear from you soon.  Make it a great June!!!
Michele Morse Reen
Posted in:General
Posted by Michele Morse Reen on June 4th, 2008 3:23 PM


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