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Trends in Mortgage Finance for 2012 and Beyond

Written By Jason Morytko, Esq.

When looking at the real estate market today, it is apparent that interest rates for refinancing homes have never been better.  Interest rates have reached all-time lows this year and there has not been a better time to refinance.  This brings up the question of how low will they go?  Or when will they begin to rise again?  There has been a lot of back and forth between the experts as to what the rest of 2012 and beyond will hold for interest rates and mortgage finance in general.  Here are some of the trends people should be on the lookout for.


No need to panic here, although it is likely the rates will rise, they are not likely to rise dramatically.   “Rates have gone back to record lows—that’s surprised a lot of people in the mortgage industry and we don’t know how long that’s going to last. Everyone is really surprised that it’s lasted this long,” says Polyana da Costa who covers mortgage finance for “There’s a much higher risk for rates to go up than down.”[1]  The future seems to forecast interest rates rising somewhat, but how much seems to be uncertain.  For now to lock in the lowest rates, homeowners should think about refinancing sooner rather than later.


The government has many programs available to homeowners designed to help refinance and lower monthly payments on their home.  Examples of these programs are HARP (Home Affordable Refinance Program) and HAMP (Home Affordable Modification Program).  The problem with these programs is that millions of Americans don’t qualify.  The government is looking to help alleviate this problem with a second attempt at the HARP program in order to qualify more home owners.  There is also good news for those home owners with FHA (Federal Housing Administration) loans.  Newly implemented this summer is the FHA streamline program which gives home owners a break in terms of annual mortgage and insurance fees.  There is even better news as the US Senate has begun talks about finding ways to get more people qualified for refinancing to take advantage of the lower interest rates that are out there currently.  So while the mortgages rates may rise in the near future, the government is making a collective effort to get more home owners qualified for refinance.


Unfortunately, there is no crystal ball that can tell anyone the future of the real estate market.  Experts have analyzed and decided that these were the safe bet trends for the end of 2012 and beyond.

[1] Handley, Meg. US News. “3 Trends in Mortgage Finance for Spring 2012(and Beyond).” May 7, 2012.