Lending Landscape - December 13, 2007

Despite a rate drop by the Federal Reserve Board earlier this week, advances in the bond markets propped up long term mortgages rates for the first time in many weeks. The standard 30 fixed mortgage moved up from last week and is hovering slightly below last year's rate.

The government-sponsored loan buyer said the rate on a 30-year fixed-rate loan rose to an average 6.11 percent for the week ending Dec. 13, from 5.96 percent last week.

At this time last year, the 30-year fixed-rate mortgage averaged 6.12 percent.

The credit markets are in disarray as rising foreclosures and mortgage delinquencies are forcing major lenders and the Government Sponsored Enterprises (Fannie Mae & Freddie Mac) to write off significant amounts of bad debt. As a result, borrowing costs for Prime loans are going up.

One lending arena that saw a decline during the housing boom, is now perfectly poised to assist first time home buyers and potential homeowners with troubled credit. The FHA has competitive rates, easier qualification and loan limits in Salt Lake County extend to $366,000.

Ask your builder about the opportunity to use FHA financing on your purchase.