By Dane Anderson, Staff Writer

ortgage expert and author David Reed has a new book coming out in December, “Decoding the New Mortgage Market: Insider Secrets for Getting the Best Mortgage Loan Without Getting Ripped Off.” 

The book is the seventh focusing on real estate financing by the popular Rollingwood author, who has appeared on CNBC, CNN, “Fox and Friends” and “Today in New York.” Reed’s advice has appeared in the New York Times, Kiplinger’s, Parade Magazine, the Washington Post and Real Simple. 

Reed is the past president of the Austin Mortgage Bankers Association and the man behind Integrity Home Mortgage, a mortgage banker with private and institutional lenders that fund real estate deals. 

The newest in Reed’s series of books aimed at helping Americans wade through the confusion and fear surrounding real estate markets today explains the new guidelines and lending restrictions. It helps consumers navigate their way through the new mortgage environment, said the local expert.

Despite the confusion surrounding real estate loans today, Reed said it is still very possible for the average person interested in purchasing a home to find a good mortgage. Now is a good time to buy because interest rates aren’t going any lower, he said.

 In fact, Reed believes interest rates will be higher this time next year.

“If you’ve got a job, some down payment and average credit, you can still get approved [for a loan],” Reed said. 

Reed said his biggest fear is that consumers will continue to listen to the national news, hear about unemployment numbers and foreclosures, and believe that it is too hard to get a mortgage.

“The funny or sad thing is that nothing is further from the truth,” he said. “People, especially first timers, need to be clear that, as long as you’ve got decent – not necessarily perfect – credit, and you can prove your income, then there’s nothing that’s holding you back from owning your own piece of real estate.” 

Reed said the mortgage market in the U.S. is homogenized now, and that means fewer loan choices.

“The loans that got us all into this mess, subprime and alternative loans, at one point made up 40 percent of all mortgage loans generated,” he said. “When these markets collapsed, suddenly four out of every 10 mortgage choices vanished. No more subprime, no more ‘stated’or ‘alternative documentation’ loans. Suddenly, it became an odd requirement that, in order to qualify for a mortgage, one would have to have a job, be able to afford the payments and have decent credit. We’ve turned the clock back about 20 years, and that is a good thing.”

That means fewer choices – conventional loans underwritten to Fanny and Freddie standards and government loans via VA, FHA and USDA. 

“At first glance, having fewer choices may sound like a bad thing, but in reality, it’s a good thing,” Reed said. “Lenders now offer the same mortgage product, so it’s easier to compare one lender to the next.”

Reed expects interest rates to stay in the high four to low five percent, at least until the end of the year. But don’t expect rates to get to the low fours or high threes, he said. 

“There’s simply too much debt being issued by the Treasury to pay for all the things we’re paying for that rates will have to stay at least where they are to keep them attractive to investors,” he said. “We also have to keep our fingers crossed that foreign governments, particularly the Chinese, keep buying our bonds.”

At some point the merry-go-round has to stop, said Reed.

“When it does, rates will push into the seven percent range relatively quickly,” he said.

The jumbo mortgage market is beginning to thaw and lenders are starting to get back in the jumbo lending game, with relatively competitive rates compared to a few years ago, said Reed.  He feel that  is good for the Westbank.

“Jumbo rates are slowly coming back down, making Westbank real estate more affordable,” Reed said. “Jumbo 30-year fixed rates can be found in the high 5 percent range, whereas just a few months ago they were nearly 2 percent higher than conforming rates.”

“Decoding the New Mortgage Market” and all of Reed’s other books are available through AMACOM Books of New York.