Attention, Tennessee Mortgage Seekers: Good and Bad News in Knoxville Housing Market

Spring is when many people put their homes on the market. But if you’re hesitant to buy or sell in Knoxville thanks to the Tennessee mortgage meltdown, there’s bad news and good news.

In general, the Knoxville housing market is doing well.

But this is the recent bad news: People with poor credit, who may have been approved several years ago, may not be able to get a loan now. There’s been a crackdown on bad credit home loan approval as foreclosure rates soar.

“It’s a very scary time,” says Loren Riddick, a loan officer with United Capital Mortgage.

Lately, he’s been working to help some of his clients manage their adjustable mortgage interest rates, but says “the problem is now is that those lending opportunities may not even be there.”

“They may find themselves in a situation where they have a 7 percent rate or 8 percent rate now and then in just a few months, they may be at 13 to 15 percent,” Riddick says of the problem many adjustable-rate mortgage holders face.

The president of a local realtor’s association, Jim Ford, says Knoxville home buyers don’t have the same worries as in the West Coast markets, however.

“Let’s say in San Francisco, an average house would be $1 million. Well, the average guy can’t afford that. So to get in, he’s got to get in a non-conforming loan,” Ford says.

Ford says you won’t find that scenario in Knoxville. But just to make sure you don’t owe more than your house is worth, he says you should stick to what you can afford. Talk about your options with a home mortgage broker today.

There is good news at least: Now might be the time to make an offer, at least in East Tennessee housing market, Ford says.

“I think today, it’s a buyers’ market. And again two reasons why: Inventory’s good. Lots of inventory of houses and interest rates are hovering about six or a little bit less.”