As we have seen that there are predicted trends in the housing market that will, obviously, offer continued lower rates for the present time and the possibility of low home loan prices for new homebuyers or those looking to purchase a foreclosed home, there is some concern over whether there are enough new homebuyers who can even qualify for a mortgage and take advantage of low costs and rates currently available. Obviously, some problems that homebuyers currently face are setbacks that they may have seen in their personal lives due to the economic downturn of years past, present levels of high unemployment, or there are simply some who are cautious as a result of problems like negative equity.
In some instances as well, homeowners are seeing tighter lending practices or there may be some cases where homeowners cannot get a loan that is enough to help them purchase the home they want. Obviously, homeowners who do not have perfect credit, which may be the result of a variety of personal financial factors, will stand to not only miss out on rates that may come at a near record low, but it could prevent them from taking advantage of a home loan entirely simply because some lenders are worried about what problems they may face if they enter into the subprime lending arena once again.
While there are financial institutions that do still offer subprime home loans, this is not something that is as common as we saw in the past, as many banks are still in a position where they have a great deal of properties sitting empty and, due to the inability to unload this inventory, some banks are in a position where they are less likely to offer aid to homeowners who are not in the best financial position and, in some cases, may pose a risk.
Yet, there are also instances where homeowners may have seen their credit rating decrease severely as a result of a foreclosure, a short sale, or the inability to meet certain financial obligations that may have resulted from factors like unemployment. Many homeowners who have lost their jobs or seen reductions in their wages often fell behind not only in there mortgage payment but in other areas as well, like credit cards and personal loans. Obviously, this will take a great deal of time for some homeowners to overcome but in instances where homeowners can show that their financial distress was no fault of their own, lenders may be more lenient when it comes to considering them for a home loan but this does not guarantee homeowners will find the financing they seek.
In the end, some homeowners may be able to get a home as a rental property, as many banks are beginning to use these foreclosed properties in some fashion so that they can at least have some form of income from a home, and potentially allow homeowners to remain in the property since they obviously will not qualify for a home loan for quite some time.