Banking Competition Bodes Well for Idaho Mortgages

By Richard Barrington
Local Lender Columnist
Jun 13, 2008
We've all read about the mortgage crisis and the housing slump gripping much of the nation, but does that mean this is a bad time to apply for a mortgage? Apparently, not if you live in Idaho, where a healthy level of competition among bankers promises to keep the mortgage market vibrant.

As any good contrarian investor will tell you, there generally are reasons to look for values in an out-of-favor market. That's when prices tend to fall, and bargains are most likely to be available. Certainly, real estate prices have fallen in many parts of the country, suggesting that for all the bad publicity the housing market has gotten this might actually be the best time in years to look for a house.

Healthy Competition

The rub is supposed to be that as mortgage foreclosure rates have risen, mortgage lenders are pulling back. Some have left the business altogether while others have tightened mortgage lending standards.

In Idaho, however, the mortgage lending business is active and healthy. In North Idaho alone five new banks have recently entered the market, swelling the total lenders to twelve. With so much competition, the reaction of these banks to the soft real estate market is not to pull back but rather to fight harder for business.

Impact on Mortgage Rates

Competition among banks benefits customers in many ways. It can mean improved service, which for mortgage borrowers translates to better responsiveness and faster turnaround times. It can also mean that banks compete to offer the lowest mortgage rates.

The difference of even a fraction of a percent on interest rates can add up to significant dollars over the life of a mortgage. So, as Idaho bankers compete for business, potential savings are available for those who shop around for a mortgage.

Source:
Spokane Journal of Business

About the Author
Richard Barrington is a freelance writer and novelist who previously spent over twenty years as an investment industry executive.