The median monthly mortgage payment for Americans has been steadily increasing and the trend conti
The COVID-19 pandemic has impacted the housing market, bringing significant changes to the financial system and affecting buyers, homeowners, and renters alike.
In February of 2021, the Biden Administration extended the COVID-19 forbearance and foreclosure protections for homeowners through June 30. During this period 1 in 5 renters were late on rent payments while another 10 million homeowners were behind on mortgage payments.
Ths mortgage relief action benefitted approximately 2.7 million homeowners in the COVID forbearance and extended forbearance options for nearly 11 million government-backed mortgages nationwide.
At the same time, interest rates for single-family homes plummeted and prompted an increase in demand for real estate.
However, it also became harder for home buyers to qualify for a mortgage and there were longer waiting times to close out loans.
Read on to learn more about how the COVID-19 pandemic has affected the mortgage industry.
Mortgage lending has become difficult on both ends due to the economic uncertainty of the pandemic. Lenders have raised the bar on requirements for mortgages and refinancing resulting in higher minimum down payments and credit scores needed, and more thorough proof of having a stable income.
This is during a time where unemployment rates in the U.S. are steadily decreasing, but remain higher than pre-pandemic levels.
While receiving mortgage relief from the government helps, it is important to assess your situation and consider all of the available options. If you are looking to refinance your home, here are some ways to improve your chances:
- Increase the equity in your home by making additional payments each month. If you are able to achieve a minimum of 20 percent equity, you can avoid getting private mortgage insurance on the loan, resulting in a decreased mortgage rate.
- Consolidate your debt. You need to consider your debt-to-income ratio, so it’s in your best interest to pay down what you owe.
- Lower your debt-to-income ratio. You can accomplish this by setting a monthly budget plan that will provide you with a better sense of your financial situation.
Mortgage Statistics for the Carolinas
The Chicago Tribune chronicled how mortgage payments were impacted by COVID-19 in every state.
Some statistics on the housing market in North Carolina:
- 12.3 percent of households reported falling behind on mortgage payments (51st highest in the US, 49 percent fewer did so in 2020)
- 25.5 percent of households with lost income fell behind on mortgage payments (33rd highest in the US, 4.9 percent fewer did so in 2020)
- 12.1 percent of unemployed respondents fell behind on mortgage (48th highest, 52.1 percent fewer did so in 2020)
Some statistics on the housing market in South Carolina:
- 25.5 percent of households reported falling behind on mortgage payments: 25.5% (25th highest, 38 percent fewer did so in 2020)
- 23.6 percent of households with lost income fell behind on mortgage (39th highest, 50.1 percent fewer did so in 2020)
- 21 percent of unemployed respondents fell behind on mortgage (34th highest, 49.5 percent fewer did so in 2020)
As homeowners and renters, you should prepare yourself for the following mortgage industry trends to take shape:
- Mortgage rates rising in 2021 and beyond
- People will steadily migrate to the suburbs
- Home sales and prices to increase, but not at the same rate as 2020
- Loan origination numbers won’t be as high as 2020
- Commission revenue will drop
We Will Help You Find the Right Mortgage Rate
While the pandemic continues to shift the housing market, COVID mortgage relief will be needed by individuals and families of all sizes in the foreseeable future. It is essential to know what options are available and what it will take to make your homeownership goals a reality.
We’ll help you get there. Contact us or give us a call (704) 412-9131 to discuss your purchase next refinance. We at Mecklenburg Mortgage are the experts and always go above and beyond for our clients.
nues to rise. While competitive mortgage rates can be found through online searches and offline research, there is much more to consider other than a simple comparison of rates from various institutions. This is a process that requires knowledge, experience, and a considerable amount of time.
For many new home buyers, the first step is to learn about what a mortgage is and how it works. This added step is also likely to be time-consuming and often, the understanding is only at a surface level.
This is where a mortgage broker comes in. As field experts, they are the key to a successful and economical home purchase or home refinance. Read on to learn about why you should be hiring a mortgage broker and how they can guide you through the process.
The Advantages of Working with a Mortgage Broker?
When you go to a bank to learn about their mortgage rates, they are limited in what they are able to offer and do not consider the rates of other institutions. When working with a mortgage broker, he or she can search through the entire market to find the best rates and programs for their clients.
Not only will this allow you to compare what is currently available, but will also provide you with more options better suited to your financial needs. In the end, one of the most common goals is to reduce your mortgage costs in the present and future. This could be the difference between living comfortably within your means and having monthly financial struggles.
Another advantage of hiring a mortgage broker is transparency. They can recommend the best rates, without any apprehension or misgivings. This is because they aren’t getting paid commissions on particular products, unlike mortgage advisors working for a bank.
A good mortgage broker can do all of the legwork for you in a timely manner. They will pull your credit report, fill out all of the necessary documentation, verify your income and employment, and apply for loans and terms that are best for you.
Overall, the goal is to save you time and money, and to make the mortgage process seamless.
How Are Mortgage Brokers Paid?
Mortgage brokers are commonly paid by the lenders and sometimes by the borrowers, but never by both. This would be an illegal action.
You may choose to pay the mortgage broker yourself, and it usually adds up to 1 to 2% of the loan amount. It is good to note that federal law does limit the compensation amount, so be cognizant of your agreement.
Searching For a Good Mortgage Rate in Charlotte?
If you are searching for a good mortgage rate in North Carolina, get in touch with Mecklenburg Mortgage today. We are a highly-rated mortgage broker company with 13 years of experience in the mortgage industry.
Our experienced mortgage brokers will walk you through the entire mortgage process from start to finish and provide you with valuable advice to ensure your payments are within your means.
Contact us today and get started on the smoothest home purchase experience of your life.