Across the board real estate experts feel that the bottom of the housing market has been hit, or at least it is very close in most areas. This is good news because once you hit bottom there is only one way to go.

There is some evidence of this out of the Mortgage Bankers Association.  In the week ending October 10th, home loan applications rose a total of 5.1 percent. This is good news because it means more people are getting out there to get a new home loan either to buy a home or to refinance their current, less than perfect loan.  According to the Mortgage Bankers Association, the seasonally adjusted Market Composite Index was in use to register 489.3 points in this week.

The jump is a full 5.1 percent over the previous week. Granted, this is much lower than the rate for the year before, but in the current housing market, any gain is a good one. So, where is this coming from?  Most of the increase comes from the number of people applying for and getting a refinance of their home loan. These numbers rose 12.9 percent last week. People are refinancing their home mortgages because interest rates are much lower after the Fed cut the rates last week.

On an interesting note, of those seeking new loans, only 2.6 percent of them were ARM’s or adjustable rate loans.  This is good news since these loans are notoriously bad business for many new home owners. I would warn anyone without a serious financial backing to support them to avoid ARM’s.  You will find these are often considered the “cause” of the problem with the housing market, alongside lenders giving the wrong people the wrong loan.

The increase in the number of applications is still low and it will need to continue in order for anyone to see their home values rise. Yet, this is a good sign, especially if it keeps up.

Those who do want to take advantage of refinancing their home loan should invest in help from the FHA. The FHA refinance loans available have some of the lowest interest rates you will find. In addition, their lending criteria are much lower than those of the traditional mortgage lenders out there currently.

If you are in need of refinancing a mortgage or you want to buy a home, there is little doubt that now is the time. The Fed likely will not lower the interest rate further, especially in the short term. Therefore, invest in an FHA loan now and get a fixed rate.

In recent weeks, I have heard a lot of people talk about the mortgage industry and how they can or can’t get a home loan. There are a number of options out there for you.  Here is some key advice to consider.

You’ve Got Great Credit

Do you have a good credit score (700 or above) and have a sizable amount of money to put down as a down payment?  You will need at least 20 percent, for example, to qualify for these loans.

In this situation, you have what you need to make it big.  Most traditional mortgage lenders are quite stable and able to provide you with the loan you need. The good news is you will not pay much for it. Interest rates are very low, with good credit, you may see interest rates as low as 5 percent in the next few months for well qualified borrowers.

You Don’t Have Great Credit

On the flip side, you also need to consider those who do not have a great credit score. If you want to buy a home, then you still have options. Here’s some advice.

If you have at least 3 percent to put down on the home and you have a credit score at or above 580, then you should consider FHA loans.  The FHA provides you with a range of opportunities including refinances of the current loans you have.

If you do not have these qualifications, I advise you to wait and get to that point. Subprime loans are highly costly and very risky. You should not attempt these even if you have the best of intentions.  How do you know if a lender is trying to qualify you for these loans?

• Ask them if the loan is a subprime loan
• Find out what the terms are
• Avoid all adjustable rate loans as much as possible: interest rates are as low as they are going to go, most believe, so you won’t save anything with these low, teaser loans.
• Get a second opinion. If you are unsure of the lender, or their intentions, talk to another lender.
• Don’t be convinced your home is worth more than your appraiser says it is: get your own appraisal to be sure they are not offering a too high estimate.

There are great loans available, especially FHA loans. Many people will qualify for these loans. As time goes on and the markets stabilize, more home loans will be available with less constricting terms, but until them make the best decision for you in the long term.

As someone that writes about home loans on a regular basis, I fully understand the frustrations so many are going through. The fact is, people are wondering several things.

• Some think mortgage companies are going to come calling to demand payment on full on their mortgage 

• Some people believe that no one will get mortgage loans again, not for a long time

• Others think that the mortgage crisis is going to cause them to lose their home even though they have made payments regularly throughout their loan

These are all mistaken beliefs.

While there are some instances when the mortgage companies can come demanding payment in full on your loan, this only happens when you are in foreclosure, after months of trying to get you back on track. Most lenders want you to keep paying them, they don’t want to own your home. For those who are making timely payments, your mortgage loan will not become due immediately.

As for the second concern, there is some concern here, but not nearly as much as you may think. First, there are loans available from nearly all of the traditional mortgage lenders in business. The requirements are stricter with some lenders requiring more down and a higher credit score before they will lend. Call it the “once burned, twice shy” scenario with home loans.

At the same time, for those without a lot of money to put down and with a credit score that is not as high as it could be, there is the FHA.  FHA loans are still available for most American home buyers. These loans require much less down (just 3%) and they provide you with an outstanding assortment of opportunity: even the fact that these are fixed rate loans.

On the final concern, as long as you keep paying your mortgage back on time, your loan is going to be in good standing and to the mortgage lender, you are a good person to have on board. The only way for lenders to make money is to lend money and charge interest.

Is Now A Good Time To Buy?

Here’s another situation I hear which is one of the biggest problems with the market right now. People who have the money and want the home are avoiding the market. This is a mistake and here’s why.

• The current interest rates on home loans are at an all time low: just 5 percent in some cases. This is the perfect time to buy.

• Lenders want good buyers. They are actively looking to lend to those that want to buy.

• Home prices are also low: lower in some areas than they have been in ten years.

No matter which way you look at it, now is the best time to buy a home, if you qualify for a home loan. If you are not sure if you do qualify, a good place to start looking is through the FHA loan specialists. These professionals provide guidance to prospective home buyers. They also have the ability to help you qualify. This is not bad mortgages, these are good mortgages and some of the safest investments to be in right now.

I have been asked a variety of things about this economic bailout package and I do have my opinions about it. Yet, I have to think of everyone, not just myself. With an eye on the housing market, you should be thinking several things about when it comes to this bailout.

What Is It?

The $700 billion worth of money being put into the current credit crisis has roots in trouble for some people, but to mean, it looks like it could be one of the better choices.

Here’s why.

By putting more security into banks, everyone benefits.

The current mortgage industry is highly tight. Unless you get an FHA loan (which I highly recommend anyway) you are likely to pay much more for a home in terms of down payment and the amount of credit you need to qualify. Yet, these banks, even the ones with the financially sound bottom line are scared and they just are not lending out money to those homeowners that would be a good risk.

The problem trickles down to every one of us.

• Banks do not lend enough money out
• Banks lose money because they simply haven’t lent out enough of it
• Home buyers want to buy homes but have to wait until they have 20 percent down payment
• The houses on the market due to the foreclosure mess sit there, causing all sorts of crime issues and a drop in the local area’s housing prices
• Housing values fall, meaning more people can no longer sell their home as they have upside down mortgages
• The housing market cannot get better: there is just so many variables in this light.

The solution is to shore up the banks and encourage them to keep lending, but only to lend to those who are good investments. I am not saying they should require a down payment of 20 percent (this is just too much for new homeowners currently.) Instead, they should be willing to look at job history, credit scores and other factors.

Let me also say that subprime loans are no good and no, I do not believe that banks in these positions should be given a free handout. I’m especially interested in them paying a sizable amount of interest on these loans from the bailout. Their top execs should not get any of it, of course.

Yet, as someone that knows the housing market needs to heal so the country can heal, the bottom line is clear: encourage lenders to lend.

What You Can Do Now

The good news is that you do not have to stay a victim in this situation. The FHA has home loan programs that can help those who are in need to get the home loan they need. This is not a subprime trap and most importantly you are getting into a good loan. 

FHA loans are the best that I can recommend right now. Unless banks start lending again, it will be hard to get loans from other traditional mortgage lenders. The good news is that the FHA loans available are at good rates.

Every day I see more homeowners who are worried, terrified really, that their loan is going to cause them to lose their home. OF course, with the latest economic data out, there is no doubt that the risks and worries are there. Jobless numbers are rising. The economy is trying to recovery (retail sales are up, which is always a good sign.) Oil prices are causing everyone to cringe every time you step up to the pump. Yet, still, the largest concern I see is a bad mortgage. If you want to fix your mortgage, what would you do? More importantly, what could you do?

Foreclosure prevention is the term of the day. This method has been designed to help those who are struggling with making their mortgage payments before the home gets to foreclosure. These are troubled loans needing help. The problem is, many loans can be worked out, but many others cannot. Why do some lenders offer solutions while others do not? Let us try to explain here.

First, who are the game players in foreclosure prevention? The mortgage servicer is on one side of the coin. On the other are the borrowers. Then, there are foreclosure prevention counselors in between, serving as the go between. In other words, you do not work directly with your lender to fix your mortgage. Instead, you work with a third party. Unbelievably, your lender does want to fix your loan because it is much more profitable (as well as much less expensive) to have you in that loan even at a lower profit amount, than it is to foreclose on you. That is not to say they will take anything, because they simply will not.

So, why do some get help and others do not? It really comes down to the numbers.

The lender is looking at their numbers and their costs. For example, if you are going to cost the mortgage lender more to stay in your home (by fixing the loan) than foreclosure will cost the lender, then the homeowner is unlikely to get their loan fixed. When foreclosure is less expensive to the mortgage provider, they are likely to go that route. In addition, they do have the right to do so.

On the other hand, the foreclosure process is anything but inexpensive. According to Center for Responsible Lending, the foreclosure process will cost the lender about $50,000.

What Happens In Foreclosure Prevention?

So, how do you know if you will qualify? First things first, the bank wants to know, directly, what the problem is. They will likely request a detailed explanation of your income and expenses, down to the food you buy and the credit cards you have. You will likely need to provide paycheck stubs as proof of income and bank records, too. Often, it is in these expenses that negotiations happen.

For example, let us say you have a nice Lexus in the garage and are paying a hefty $500 a month on it. The lender may require that you get out of the loan before they will work with you on foreclosure prevention.

Then, the mortgage lender will begin to figure out just what you can afford in payments. Let’s say that you bring home $4000 a month and have $2200 in expenses and you put aside $200 a month in savings. The lender will then work with you to get your housing payment at $1600 or around that much.

Now, remember, as a homeowner your lender is not going to work with you directly on this. You will need to contact third party mortgage prevention specialists.

It is also likely that you can find some help available to you through FHA loan specialists who can help you get into a new loan altogether. Whatever you do, do not sit on a bad loan.

In the recent news is a lot of information about the subprime markets, the worries about foreclosure, but if you are current on your mortgage or have less than perfect credit and want to buy a home, where does that leave you?

I admit, the news of late especially with Congress trying to pass a bill to help move the housing market along is interesting and it has consumed some of the headlines. However, let us not forget that we are moving into the largest house buying time of the year: spring and summer. People move much more often in the summer months mainly because the weather is nice and the kids are out of school. If you are considering it, you may be consumed with worry about your less than perfect credit.

The housing market “crash” and the “credit crunch” are worrying plenty of people who want to be in a home. Some are staying in rental opportunities longer now than they would have just a few years ago. That may not be necessary. In fact, there are some outstanding opportunities for people to get into homes right now.

Avoid Subprime

With the fall of the subprime lenders, you will find it more difficult than ever to find a lender willing to loan to someone that has a low credit score. Rightly, so some people with credit scores that are too low will not be able to find any type of lending opportunity even from the FHA. Yet others, who will fall somewhere in the middle may find a lender.

FHA is able to help those with spotty credit scores to get into a home. They offer loans that do help consumers working on improving their credit, with proven income and employment. There is no doubt that you may pay a bit more for a loan this way through some lenders, yet the FHA programs do offer help to those looking for a way to prove themselves.

You will need to prove yourself to the Federal Housing Administration, though. To have approval for an FHA loan, you will need to provide details of your income, back records, paycheck stubs and anything else that can prove that you are a viable applicant. The FHA is not in the business to secure too risky loans, and these checks help to insure that is the case.

Is This New?

You may believe that this is something new that the FHA programs are doing. That is not the case. In fact, the FHA has a strong history of stepping up to the plate whenever there is a housing scare in which lenders are no longer willing to provide as flexible of loans as they used to.

An example of this happened in a recession during the 1980’s when many of the Texan housing markets fell drastically because of the oil situations there. While lenders reigned in their lending abilities or willingness, the FHA stepped right in to help stabilize the industry. In fact, the very foundation of the FHA is that of helping to establish home ownership in the United States (it was created during the Great Depression to help people buy homes.)

I highly recommend if you are in a situation where you have a good income history and can afford a mortgage, but are worried about shaky lenders, to use the FHA to help you get the home you want. You do not have to wait for a better market, especially when a number of opportunities like low priced homes are available. While the FHA cannot help everyone searching for a home with bad credit, it is able to help many that need and deserve an opportunity.