Just a few short weeks ago mortgage rates were still dropping and even people with less than perfect credit could buy a home here in the Lehigh Valley for just over 6%. Persons with strong credit scores (over 650) were getting 30 year fixed rate loans for 5.5 – 5 3/4%. But those days are gone, at least for the time being.

Contrary to what may people believe, banks and mortgage brokers have little control over the rate that you pay when you buy a new home. especially if it’s an FHA loan. The federal government sets and controls the interest rates. Guidelines are set, based on credit score, purchase price, and type of loan. Recently rates have been creeping back up. So even if you have a good credit you can expect to pay over 6% – even close to 7%.

Don’t panic though, rates are still the lowest they have been in years, and are not expected to go too much higher any time soon. But 6.5% to 7.5% will be the norm for the next few months at least. And prices are still coming down, though again not as drastically as you may believe if you watch the news. The Lehigh Valley has always been a strong housing market, and will continue to be for the foreseeable future.

If you are considering buying a home within the next few months and would like a free pre-approval to see what kind of rate and purcahse price you can qualify for, please contact us