On the West and East coasts, real estate prices have been increasing during the last five years. In certain areas of California, houses are being sold for an average of 33% more than they were last year. This raise in prices is making it much more difficult for people to purchase a home.

Throughout the past years, mortgage has become an option to buyers, to ease the payment of purchasing a home. Buyers can get a mortgage with a interest rate that varies with the rise and fall of the market, and also a mortgage that only requires interest payments for the beginning years of the loan. These choices allow buyers to make small repayments, even on houses that they would not normally be able to afford. Although, in the later years of the payment, they will increase, along with the homeowners income.

Another, newer mortgage option that has been available for about 20 years, has a 40 year term, instead of the 15 or 13 year terms. Few loan lenders offer this plan as an option, but this may change as Fannie Mae has announced their want to purchase more 40 year mortgages. Lenders will probably be much more willing to offer the 40 year mortgage to customers after Fannie Mae has purchased more 40 year mortgages.