Home Prices Expected to Fall More

[Feb 26, 2010.]

 

Looks like home prices are going to continue falling through next year. That may be good news if you plan to get a mortgage and buy a home, but bad news if you want to sell or are underwater on a loan.

A joint report from Fiserv and Moody's Economy.com says average home prices in the U.S. are going to fall 6% by September 2011. The average home price has already fallen 27% over the past three years.

More Foreclosures

The housing market continues to be greatly impacted by foreclosures. "Foreclosure sales will pick up this spring as mortgage servicers figure out who can qualify for a modification and who can't," Mark Zandi, co-founder of Economy.com, told CNN Money.

Keep Making Mortgage Loan Payments

Are you concerned about being underwater on your mortgage? Owing more on a home mortgage than the property is worth can be very stressful. If you are able to keep with your mortgage payments, continue to do so. It's better to stay current on a mortgage than end up in foreclosure.

Here some things you can do if you need help with mortgage payments:

• Consider mortgage refinancing to lower your interest rate


• Contact your mortgage company to discuss a loan modification


• Pull out all the stops to sell your home, even if you have to set up a short sale

Mortgage Loans for Purchase

If you've been saving up money for awhile, it may be time to purchase a home. There are good deals to be had on homes if you aren't concerned with timing a purchase to hit the absolute low in the housing market.

Here are some things to consider when looking for a house to buy:

• How much can I borrow for a mortgage? Mortgage companies want to know that you have a stable income, a sizable down payment, and not too much debt before offering you the lowest mortgage rates.


• Shop around to find a mortgage broker who intends to work for your best interest. Ask how they get paid and how much experience they have.


• If you want a foreclosure deal, consider buying a bank-owned property. This can allow you to avoid a lot of the headaches that come when trying to deal directly with distressed homeowners or purchasing a property at auction.

Although the average home price continues to fall, keep in mind that property values in your area may be better or worse than the national average. It's important to research your local housing market to determine what's happening with home values.

 

About Author:

Francine L. Huff is a freelance journalist and the author of The 25-Day Money Makeover for Women. She has appeared on a variety of TV and radio shows.