Down Payments Continue to Decline in Third Quarter

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This is probably a trend that will continue into the near future. As home prices and mortgage rates rise less people will be applying for mortgages. The quest for new business will cause down payment requirements to decline slightly from month to month. For a more detailed look at this subject – please read the article below.

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The average down payment on a 30-year, fixed-rate mortgage loan in the third quarter of this year was 15.73 percent, according to Charlotte, North Carolina-based LendingTree, an online marketplace connecting potential borrowers with lenders.

The third-quarter average is down 2.74 percent from the previous quarter, according to LendingTree, which suggested in a press release that the drop is due to a slight loosening of standards by lenders across the nation.

“Lenders are putting more focus on purchase mortgages and are adjusting minimum requirements to attract borrowers,” said Doug Ledba, founder and CEO of LendingTree.

“With home values improving, the risk of borrowers defaulting on loans has decreased, giving lenders more confidence to lend with less cash down from qualified borrowers,” Ledba said.

The lowest average down payment percentage in the third quarter took place in Nebraska, where down payments averaged 12.5 percent of loan values.

South Dakota (12.8 percent), Arkansas (12.9 percent), and Alabama (12.9 percent), followed, all with averages under 13 percent for the quarter.

Missouri filled the No. 5 spot with an average down payment of 13.1 percent.

The highest down payment percentages in the third quarter were recorded in New Jersey (18.8 percent), California (18.6 percent), New York (18 percent), D.C. (17.9 percent), and Massachusetts (17.5 percent).

To read the complete article – please use the link below.

Down Payments

Explore posts in the same categories: Real Estate Market Trends

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