Lower median prices, more time on the market, higher inventory. That’s the general picture of our housing market today. With home values dropping, foreclosures increasing and some owners finding themselves owing more than their homes are worth, the numbers prove that Kitsap County is not immune to the troubled economy.

All of these conditions have made for a buyers’ market. If you are in the market for a new home, there is no better time to buy. Home prices, as well as mortgage rates, are reasonable. If you were considering selling to upgrade to a different home, perhaps it’s time instead to refinance to get a better payment and hold off on selling for a while. Reducing your interest expense will pay off in the long run but be careful of becoming a refinance regular. Multiple refinancings can reduce your overall financial benefit and the fees associated with the restructure can eat away at any long term cost reduction you may have realized. However, some homeowners appreciate the ability to extend the loan back out to 30 years, reducing the monthly payments. When weighing the refinance decision, homeowners typically are urged to consider how many months of lower payments it will take to recoup the closing costs of the new mortgage.

Interest rates for 15-year and 30-year fixed-rate loans still hover near historic lows. According to Freddie Mac, a 30-year, fixed-rate mortgage in January of 2004 averaged 5.71 percent as compared to the same loan in January of 2009 at 5.05 percent. Believe it or not, the 30-year fixed rate average in October of 1981 was 18.45 percent.

First-time home buyers receive an extra benefit when purchasing a home. A new first-time home-buyer tax credit provides benefits for qualified home buyers. First-time home buyers can get up to an $8,000 tax credit for purchase of a principal residence. This applies to homes purchased between Jan. 1 and Nov. 30, this year. Buyers are considered “first-time” buyers if they have not owned a home for three years or more. The credit does not have to be repaid if the home isn’t sold for three years. There are some limits on income. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit ($150,000 for married couples), and those earning more than these thresholds may be eligible for reduced credits.

When it comes to getting a mortgage, you can’t always believe what you hear in the media. Although banks have tightened their restrictions, applications are still getting approved. As always, your good credit plays a big role in your ability to get a loan.

This column is provided by American Marine Bank. Contact the Kingston branch of American Marine Bank at (360) 297-1711 or mortgage lending at (800)648-3194