Today's Mortgage Rates

Pregnancy has a lot of risks associated with it. But other than some of the obvious health issues involved, now your dreams of home ownership could be affected.

Apparently mortgage lenders are giving the thumbs down to parents who are expecting a baby or are on maternity leave when they apply for mortgage loans, according to the New York Times. That’s because mortgage lenders want to see proof that a borrower’s current income is enough to cover mortgage payments.

So if you just had a newborn and are on maternity leave, it’s likely that you won’t qualify for a mortgage even if you plan to return to work soon. Even if you can actually afford to buy a home to accommodate your growing family and are guaranteed a job after a leave, you may be required to provide even more proof of qualifying income and assets than normal.

In some cases, banks are showing new parents to the door and instructing them to apply later when they are back at work. And don’t think that new moms are the only ones being denied. Workers who are on other types of leaves from their jobs and have a drop in income may also be out of luck when applying for a mortgage.

“Maternity leave or any other leave of absence often prevents a person from obtaining a mortgage. There are some who long for the days when such strict proof of income was not required,” John Councilman, president of AMC Mortgage in Fallston, Md., told the New York Times.

U.S. home builders are less confident about the housing market, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI).  Although the government’s tax credit for home buyers helped fuel a flurry of activity in the housing market earlier this year, sales have declined since the credit expired in April.

NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich, said:

The home buyer tax credit did its job in stoking spring sales and we expected a temporary pull back in the builders’ outlook after the credit expired at the end of April,” “However, the reduction in consumer activity may have been more dramatic than some builders had anticipated, which resulted in their lower confidence levels.

The HMI fell five points to 17 in June. The index had risen over the past couple months, but is now back to where it was in February. The monthly survey looks at whether or not builders expect sales of current single family homes to be good, fair, or poor over the next six months. It also asks them to rate their expectations for traffic of prospective buyers. An overall score of 50 and up means more builders believe that conditions are good rather than poor.

Are you hesitant to get buy a home now because you’re concerned about a lot of the negative news you hear related to the housing market? If you are truly ready to buy a home, don’t get discouraged because other people have a lot of opinions about where interest rates may be heading or whether or not more homeowners are expected to be underwater on mortgages or in foreclosure this year.

Analyze your situation carefully to determine if now is a good time for you to buy a home. Consider the following questions:

—Do you have a significant amount of money to use as a down payment on a home? To qualify for the best mortgage rates you should put down at least 20% of the purchase price of a home. The more you pay out of pocket now, the lower your monthly payments are going to be.

—Have you assembled a dream time of advisers to get you through the home buying process? A knowledgeable mortgage broker can help you find competitive mortgage deals from several lenders. You also should not get involved with any real estate deal without having a reputable attorney ready to review all the paperwork and contracts. What about a home inspector? You need someone who checks out a lot of homes and can inform you about any red flags with the property you are considering buying.

—Do you have a stable job? Although many people have lost jobs over the past couple years, the fact is that the majority of folks are still working. It’s important to have a steady source of income if you plan to make mortgage payments on time.

—Has your family outgrown your current living space? Whether you live in a small apartment or already own a home, it may be time to get a bigger place if you have a growing family. Whether you are expecting a child or have elderly parents moving in with you, purchasing a home may be a necessity to accommodate everyone.

Do not rush into purchasing a home just because you heard that mortgage rates might begin to rise. There are still plenty of deals to be had in the real estate market. Take the time to research the area where you want to live and to find the best mortgage package in order to make the home buying process as smooth as possible.