New Mortgage Rules Rolled Out

January 10, 2013

Homeowners looking to sell are having a lot more luck now than they were just a few years ago.

"We tried a few years ago and didn't have much success but this time we've had 10-15 showings and it's going well," said Lake Monticello resident Angela Ott.

The Otts put their house on the market in 2009 but didn't receive much interest. They listed it again in August and are seeing many more potential buyers. Realtors in the area say the signs point to a healthy 2013 for the housing market.

"Almost every indicator that we look at is positive," said Jim Duncan, a realtor with Nest Reality Group. "2013 seems to be in position to be a better market than it was last year."

But new mortgage regulations rolled out by the Consumer Financial Protection Bureau may have a big impact on the market.

"Everyone is going to be effected by this," Duncan said. "Sellers, buyers, lenders, real estate agents-any part of the economy that's touched by the real estate market."

Changes in mortgage regulations include limits to upfront fees. The new rules also prohibit interest-only payments. The new rules also mark the first time the government will define a "qualified loan" by setting standards of income for potential buyers. The goal of the CFPB regulations is prevent the kinds of toxic loans that contributed to the housing crisis.

"Slightly tighter restrictions on lending guidelines might make it more difficult for a buyer to get a mortgage and for a seller that might mean there are fewer buyers out there," Duncan said.

It's a dominoes effect. Fewer eligible buyers make things more difficult for homeowners looking to sell.

Ott and her family have already purchased land in another Fluvanna County neighborhood, but need to sell their current home before building they can move forward building their dream house.

"I'm extremely nervous," Ott said. "We just dropped the price a little bit more. We just need to get out of this before we can start the next phase."

To read the CFPB mortgage regulations Click Here

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