The low interest rates offered by mortgage lenders during the economic downturn have improved housing affordability, according to an index prepared each year by the Vermont Economy Newsletter. The percentage of income consumed by mortgage payments on the average Vermont house for the average married couple family in Vermont decreased to 13.1%.
However, since many of these families have two wage earners, they are not likely to encounter the many fees faced by households for whom saving a 20 percent down payment is impossible. Only about half of Vermont's households include married couples, according to the 2010 Census.
In an interview with Rutland Herald reporter Bruce Edwards yesterday, VHFA’s Sarah Carpenter pointed out that obtaining the mortgage insurance required of borrowers unable to save 20 percent down payment and the other fees that traditionally accompany home buying with little down has become more costly and harder to obtain than before the recession.
Low and moderate-income home buyers who are unable to save a down payment or qualify for the very low interest rates typically limited to higher income borrowers with stellar credit, may find assistance through organizations such as VHFA. Some VHFA loans, such as government-insured loans, are uniquely capable of offering competitively low interest rates to qualified borrowers who have not been able to save a down payment.
Read the Rutland Herald article.