Now or Later

For Americans wanting to buy a new home or refinance their current one there are always two times to do it:

1. Now
2. Later

So why ask a mortgage guy if now is a good time or not? Because no matter how low houses go this year, if you can't get a loan to help you buy it, it will do you no good.

Over the past few months I have seen a lot of changes to different loan programs out there and I believe many more changes are coming. So is now I good time to buy or refinance, I would say it absolutely is!

So why is it a good time to buy now? Because none of us mortgage guys can predict what the market will be doing later.

"Now" is full of knowns. "Later" is full of unknowns.

The mortgage markets are tightening (less money in them) and so lenders have no choice but to tighten their lending practices. Think of it this way, if you only have so much money to lend won't you just want to lend it to the "best" people, the ones you are very sure will be able to pay it back?!

What are these changes that will take place?

I believe their

1. Second Mortgages -- currently most banks will allow you to go up to 90% of the value of your home, soon it will drop to 80%
2. Credit scores -- currently a 680 score puts you in the safe zone for pricing, expect that score to go up to 720.
3. More money down -- currently there are still no money down options, expect everything to grow by 5% down. So if you were putting nothing down before, now it will be 5%, or if you were putting 10% down for a program soon it will be 15%.
4. Stated income programs -- we currently can still do them, but some lenders have already started to drop those programs, because of the obvious risks associated with them.
5. Property type -- now condos and single family residences are treated basically the same when lending money, expect that to change, you will be required to put more money down on a condo then a single family residence.
6. Every mortgage product will get an overhaul -- Expect many of the products you know now to change in the next little bit.

So back to the question, is now a good time to buy???

Yes it is, not because home prices are priced low right now, but because come Fall you may not be able to purchase a home because of lack of credit, down payment or any of the reasons listed above.