June 12th, 2018
According to a new study conducted by Laurel Road, consumers, specifically college-educated consumers, may not be as up-to-date and knowledgeable about the housing market as is generally thought. The study showed several common misconceptions about the housing market that many Americans hold, such as:
- Roughly 50% of respondents aren't aware of down payment options, believing 20% is necessary in order to purchase a home. Moreover, around 33% of respondents stated that a 20% down payment is unattainable and is a main barrier to home ownership
- Many respondents believe interest rates are expected to hit 6% by the end of 2018 and are therefore nervous about obtaining a mortgage, even though the MBA's prediction is closer to 4.6%
What does this mean for you? You need to focus on educating your borrowers not only on correct loan options, but also on the market in general so they have a thorough and accurate understanding of what the market is doing, what opportunities it presents, and how to capitalize on the current state of the market.