Innovations emerged in the last decade of the twentieth century that are transforming the way home mortgages are made and are promising to bring even more changes in the years ahead. These changes have benefited mortgage borrowers and homebuyers to a great extent, although there are some important tradeoffs. Most importantly, the borrower is in a position today to shop more effectively and make critical decisions based on better information. However, that borrower needs to be aware of the financing choices and sources of information available in order to get the best value.

The big trends affecting the market include:

• The use of computers and electronic communications to speed loan applications.
• The development of a national market for mortgage loans and the growth of major institutions to further that development.
• The demise of inflation has reduced volatility in interest rates and encouraged lenders to extend financing to borrowers once considered too risky. More->