Just the other day, we took a look into what the coming new year looks to promise for the world of real estate.  If one thing is clear, it is that market changes will continue to expand and grow upon developments we’ve seen over the last several months.  And of course, there’s always room for a little surprise here and there too!

But just what does 2008 hold for the home lending and mortgage industry?  Let’s take a look…

Firming Up the Interest – As the entire real estate market begins to regroup and adjust itself for an optimistic rebound, home lending will also follow suit.  Throughout 2007, it seems like we’ve constantly been focused on trying to predict how interest rates will move next.  But now that current happenings are better understood, expect interest rates to stabilize for awhile during 2008.

Think More Conventionally – It’s easy enough to predict that the mortgage banking industry will seek stability through tried and true lending practices that have been time tested and proven reliable.  During 2008, as we rebound from previous shaky financing, conventional fixed rate loans will be more popular than ever for those who are well qualified.  And for those that aren’t – well things won’t quite be the same…

The New Lending Alternatives – Just as subprime loans and unpredictable ARMs have been the alternative lending staple of choice for quite some time, now that the risky business has more or less imploded on itself, other lending alternatives will keep on showing up in 2008.  However, this time, many of the alternatives will involve various forms of seller financing instead of what would have been done with subprimes in the past.

Plan for Full Disclosure – As lenders have figured out that they have to protect their investment a little bit more diligently than the “anything goes” attitude of recent years past, low doc and no doc home loans appear to becoming more and more obsolete.  The reasons are legit and although more paperwork is likely to be required as we move through the new year, at least the mortgages will be based on solid ground.

Mortgage Professionals Shall Prosper – Professional is the key word.  Expect a much more professional attitude from those in the lending business in 2008.  Many mortgage brokers who were just riding the wave have since been forced right out of the business.  Those that are left look to be more keen on what’s going on in the industry.  They’ll continue to prosper by keeping a totally professional attitude and only putting together deals that promise to work.

So there’s my take on 2008 when it comes to mortgages and home lending.  Up next will be predictions on what’s in store for real estate technology in the new year.