Financing Remains Tight

The impediments to a faster recovery were lenders’ too-tight with their credit standards and the rise in mortgage interest rates, which broke the 4 percent barrier in mid-June.  The average home buyer faced major challenges in getting a home loan and were required to put a larger downpayment.

Another financing hurdle for housing was poly changes at the Federal Housing Administration, which hiked mortgage insurance premiums for FHA loans and began requiring many FHA borrowers to pay annual premiums for longer periods.

Mortgage interest rates remain low, sustaining homeownership as an attractive and affordable opportunity for Californians.

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