Are Low Mortgage Rates Limited to Affluent Households?

It is a complex personal financial issue. The confusion of who qualifies for what in pursuit of home loan financing, and in regards to assets and money management is a perplexing question. In a recent report released by the Pew Hispanic Center pertaining to a "wealth gap" the report determined that the median net worth of non-Hispanic White households totaled $88,651. Alternatively, the difference in annual household Hispanic families was $7,932 and $5,988 for African-Americans.

According to the standards detailed in the FRCA, the pronounced variations differ to some degree by homeownership patterns. Moreover, the percentage of Caucasian households who owned homes in 2002 was 74.3 percent compared to Hispanic and non-Hispanic African Americans were 47.3 percent and 47.7 percent respectively.

With the availability of mortgages and the growing cost of the value in a home, the wealth gap is exposed transparently. Based on data and research compiled by the National Association of Realtors, the median existing-home price is $190,100. With an almost ten percent rate of growth in residential property -- homeownerships remains a solid investment

A fundamental component of household wealth is home equity. It accounts for two-thirds of the average net worth of both African American and Hispanic households. In the recent downturn of the economy, the potency of the housing industry has cushioned the erosion in wealth of households which can be traced to the loss in value of financial assets.

The staggering rates of low – inflating mortgage rates are labeled by the following observations:

• Compared with the net worth of native born households, the net worth of immigrant households is only 37 percent"

• Although African Americans, Hispanic, and immigrants demonstrate early indications of rapid assimilation into homeownership, it takes roughly 20 years for the homeownership rate amongst immigrants to equal the low mortgage rates of native-born households.