Hey Chicken Little, the sky is not falling in Washington DC!
Everyone Just Figured Out Washington DC Is Not A Declining Market!
A few of the major mortgage insurance companies just announced that they have taken Washington DC off their declining markets list.
If you follow this blog then you read the post last Fall where I wrote about how “declining markets policies” were reducing people’s odds at getting a mortgage. But now that is changing, as some banks, PMI companies and Fannie Mae are playing catch up to the realities of our marketplace.
On a Conforming loan (one that goes to $417,000) you should be able to do as little as a 5% down payment. That stopped last year thanks to declining market policies, where banks required another 5% down and mandated that mortgage borrowers had 10% down! Now they can go back to 5% down.
And on Conforming-Jumbo loans (ones between $417,0001 to $729,750) you could do a 90% loan with a 10% down payment. But the declining markets policy required another 5% down, so people borrowing between $417,001 and $729,750 had to put 15% down. Now they can do a 10% down payment again.
This is huge, both for the mortgage borrowers in the DC area that can likely get maximum Loan-To-Value financing again, as well as for the DC market in general, as an acknowledgment that the market here is strong.