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First, mortgage rates remain—at least for the time being—at near historic lows. The latest reprieve from higher rates is thanks to the bond market’s reaction to global economic concerns. Yet, as the jobs data indicate, the U.S. economy is on much better footing than the rest of the world.
Key factors for first-time buyers
But the key issue for first-time buyers has not been rates, which have been historically low for several years. Their employment situation, overall level of confidence, ability to qualify for credit and ability to afford the down payment have been the larger issues.December data show that employment for younger households, in particular, has improved dramatically in the past year. For example, more civilian jobs for 25- to 34-year-olds were created in 2014 than in any other year since 1987.
Mortgage backers Fannie Mae and Freddie Mac clarified their credit qualification standards in the fall, which had been murky since 2009 legislation enacted in reaction to the housing bust. This should make it easier for many would-be home buyers to get a loan with slightly lower FICO scores and slightly higher loan-to-income and debt-to-income ratios.
The new low-down-payment programs announced in December from Fannie Mae and Freddie Mac will make conventional mortgages more accessible to first-time buyers.
con't.... http://www.realtor.com/news/first-time-buyers-face-rosier-prospects-in-2015
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