Hope for young homebuyers

By DEIRDRE FULTON  |  February 23, 2009

To avoid the mistakes — and fates — of reckless lenders who contributed to the economic crisis by lending money to people who were (or became) unable to pay it back, Irving says that "responsible lenders are taking time to verify income, job stability, residual monthly funds ... and taking time with borrowers to fully explain" the terms and features of their mortgages.

"With the predatory and less traditional lenders out of the market there has been a 'return to quality,'" MaineHousing's Peter Merrill said in an e-mail to the Phoenix.

Borrowers, too, are coming to the table more informed and logistically prepared, brokers and bankers say. (See the sidebars for thoughts from real homebuyers.) They're coming to lenders with a solid idea of their credit history and available funds. Many are taking advantage of the hoMEworks first-time homebuyers' course offered by MaineHousing — a low-cost class that qualifies its participants for lower loan interest rates. And now, they have an $8000 tax credit to add to their toolkits. This tax credit (check with a tax pro for the details, but generally it reduces the amount you owe in income taxes, and may land you a tax refund) is substantially less than what some real-estate observers were hoping for — a heftier $15,000 credit. However, unlike the $7500 tax credit passed in the middle of last year with a similar goal in mind, the one bundled into the stimulus bill does not have to be repaid over time.

Of course, none of this matters if lenders don't feel secure in whom they're lending to. This is a vivid reminder of how closely linked the job and housing markets are. (Maine's unemployment rate, 7 percent, is almost at the national average of 7.1 percent.) No one will buy houses in Maine if they can't support themselves, and vice versa. As Portland homeowner Jed Rathband points out, "I'm not as concerned about the value of my house — though it is less than what I currently owe — as I am worried for my ability to continue working in Maine."

Deirdre Fulton can be reached atdfulton@phx.com.

< prev  1  |  2  | 
  Topics: News Features , Barack Obama, Politics, Jed Rathband,  More more >
| More

Most Popular
Share this entry with Delicious
  •   FERTILE GROUND  |  April 17, 2014
    Maine’s medical marijuana activists celebrated several victories over the last couple of legislative sessions, and they’re (mostly) looking forward to local and statewide legalization campaigns coming over the next two years.
    It’s like a version of the truth that’s fun to read — but difficult to categorize.
  •   INSPIRED BY THE LEGENDS  |  April 03, 2014
    Acclaimed local singer celebrates Judy Garland
  •   A SUNNIER OUTLOOK  |  April 03, 2014
    The Pew Research Center’s Journalism Project released its annual State of the News Media report last week.
  •   ENTER THE WORLD OF FELIX YZ  |  March 20, 2014
    The brainchild of local author and WMPG program director Lisa Bunker, Felix is the 15-year-old protagonist of a new interactive online serial, The ZeroDay Countdown of Felix Yz.

 See all articles by: DEIRDRE FULTON