Hey Chicken Little…Look…Washington DC Is Not Falling!

April 9th, 2010

stickman falling

Hey Chicken Little, the sky is not falling in Washington DC! DC Is Not Falling.

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”. It stated these policies were reducing people’s odds at getting a mortgage. But now that is changing. 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.

All real estate is local. Always look at factors like job growth, population growth, income growth, corporate news, government news, and more. There are a lot of details that go into each individual real estate market’s growth.

Brian Martucci is a loan officer for Capital Bank Home Loans, a division of Capital Bank, N.A. He has been in the mortgage industry since 1986 and has served in a number of roles, including loan processor, loan officer, mortgage broker, branch manager, and vice president. Brian Martucci – NMLS# 185421. His opinions do not necessarily reflect the opinions and beliefs of Capital Bank Home Loans or Capital Bank. Capital Bank, N.A.- NMLS# 401599. Click here for the Capital Bank, N.A. “Privacy Policy”.

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