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South Florida Real Estate
Why Current Mortgage Market is Like the Diamond Trade
The main reason the current mortgage market is like the diamond trade is because the Fed’s current policy has been to create the market for mortgage backed securities. The Fed agreed to spend $ 1.25 trillion through the first quarter of 2010 to purchase mortgage bonds, thereby keeping interest rates low and stimulating the housing market.
The video below, How Interest Rates Move, does a great job of explaining interest rates in general and how the Fed’s policy has affected the housing market the up until now.
Buying a Home? Get Pre-Approved For a Mortgage
The first and most important step in buying a home is to get pre-approved by a lender for a mortgage. This can be directly from a bank or credit union you do business with or through a mortgage broker. Getting pre-approved will let you know how much house you can afford or, better yet, how much of a house you feel comfortable with. The lender or mortgage broker will give you an idea of what your monthly costs will be and will give you a Good Faith Estimate of closing costs to let you know how much money you will need to bring to the closing table to finalize your purchase.
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