The national mortgage industry has experienced unprecedented change during the past two years, which has resulted in a number of popular consumer misconceptions regarding the availability of home financing.

Mortgage Misconception #1: “There’s no money available for home loans.”

While it’s true that the recent credit crunch temporarily affected the mortgage markets, the 2009 credit market has progressively improved for homebuyers.

In fact, many established homeowners have already seized upon the opportunity to refinance to lower interest rates. These refis prove that savvy consumers can do more than survive in a tough market – they can improve their long-term financial outlook and save thousands over the life of their home’s financing.

Mortgage Misconception #2: “The days of low down payments are gone for good.”

While it’s true that “no money down” loans are almost exclusively restricted to VA loan qualifiers with full entitlement, FHA loans with down payments beginning at 3.5% are available and popular. Some FHA loans allow borrowers to use gift funds from family members, friends or employers to help cover the down payment.

Mortgage Misconception #3: “Buying a home in a high-cost area is almost impossible.”

Real estate prices on the West Coast have traditionally been some of the highest in the nation, which translated into a need for a large percentage of non-conventional Jumbo loans over $417,000.

Although jumbo loan figures fell in 2008, similar to many other financial statistics, perhaps surprisingly, they’ve made a comeback in the first quarter of 2009. According to a recent issue of Inside Mortgage Finance®*, the Jumbo sector’s production figures were up 109% over the 4th quarter of 2008. While credit requirements for Jumbo loans have become somewhat more restrictive, they’re still available for qualified borrowers.

Mortgage Misconception #4: “In today’s market, closing on a loan is difficult and complicated.”

The majority of loans closing in 2009 are no more complex than they were in the past. Keep in mind, even in boom times, there were still a great number of disclosures and necessary paperwork associated with closing a conventional “full doc” loan. This hasn’t changed.

Although first time homebuyers may find the process a bit overwhelming a first, the truth of the matter is, most of this paperwork is mainly designed to protect the consumer. A reputable lender will take the time to go over all closing documents with buyers before the day arrives, making the experience as fulfilling and exciting as any other major life event should be.

Mortgage Misconception #5: “Low interest rates are a thing of the past.”

Even though mortgage rates are beginning to creep upwards, today’s numbers are still some of the lowest in years. As of August 5th, 2009, Bankrate.com’s weekly Interest Rate Roundup reported that the average 30-year fixed rate for mortgage lending rose nine basis points, to 5.65%* – still a highly competitive rate.