Despite the weak recovery of the US economy, The US mortgage and housing market seems to be on the right track. US economy is expected to grow in 2013, but not with a brisk pace. The expected increase in home prices in 2013 is 5%, which was around 7% during 2012. Owing to the ample refinancing activities, the year 2012 turned out to be a treat for the mortgage industry. The trend is expected to be the same in 2013, for which many banks and non-banking entities have expanded on their services to enjoy the perquisites of mortgage in 2013.
During 2012, people showed great consideration towards the single-family based homes while renting a home became less prevalent. In 2013, this market is set to grow with the sales volumes expected to grow big time. In 2013, reports suggest that 25% more homes will available for the mortgage industry to offer to the potential clients. Talks about the recession in the world, especially in the US can set the panic alarms ringing. It can dent the customer confidence derailing their appetite for buying a new house. Other than that, everything is on the right track. The US economy is expected to enjoy a slow growth in 2013, paving the way towards a competitive mortgage industry with highlights detailed below:
- Higher Fees Coupled With Stringent Requirements
According to FHA, the mortgage annual premium is going to be increased for the year 2013. Therefore, the homebuyers going with lower initial payments will have to pay higher mortgage premiums for getting an FHA mortgage. The exact increase is 0.1%, but the financial experts are of the view that higher increases may be somewhere down the line this year. Along with that, the Federal Housing Administration is also planning to come up with stricter borrowing requirements for individuals having a credit score of 580-620.
- Count on the Low Mortgage Rates
The mortgage rates have fallen considerably, maybe, to the extreme bottom. The financial analysts do not expect the mortgage rates to fall any further. For the first quarter of 2013, the mortgage rates may remain consistent, with a slow and gradual increase towards the latter part of the year. If you have not benefited from lower mortgage rates yet, then it is the ideal time to count on the lower rates on offer.
- Renting the Home Can Do the Trick
The major reason of the increased rents is the fact that demand of apartments has increased, whereas, the actual number of houses and apartments available for rent has gone down considerably. The mortgage rates have a huge influence on this, and this will be the trend throughout 2013.
- Revised Mortgage Rules and Policies for the Year 2013
The mortgage industry has marked the new year with the revised servicing and mortgage rules. The new policies are yet to be introduced in the market, so you cannot predict the outcomes these can fetch. According to the new policies, the mortgages will be difficult to come by, as the new rules involve restricting the lending process resulting in the unavailability of the market capital. The advocates of the new policies are of the view that it will bring stability in the market, making it easier for the customers to get mortgages.
Inc.’s #39 finance business, Network Capital, lists the current 30 Year Fixed rate at 3.500% with today’s markets still running, yet FHA backed mortgages seem to be dropping every day. 2013 definitely looks great for those seeking new homes or refi’s.
- Principal Reductions Can Help the New Homeowners
In 2013, ample refinancing opportunities are set to ease the nerves of the new homeowners. If you are a homeowner and want to capitalize on such an opportunity, then 2013 can serve you ideally. With the post-election period, the stability in the market is worth noticing. With all this, the principal reductions can help the homeowners enjoy the due share in the mortgage industry, especially for 2013.