Picture a real estate market where conventional mortgage financing is divided into just two, unequal segments. I am not making this up:
- "Grade A" loans that get the best rates available but require a minimum 30 percent down payment. Since most homebuyers don't have that sort of cash sitting around, there aren't large numbers of new mortgages in this category. It's pretty much reserved for the credit elite -- refinancers who've built up substantial equity and upper-income savers looking to buy a house.
- "Grade B" loans are for everybody else. They come with 2 to 3 percent higher interest rates than Grade A, but allow smaller down payments. Because of the steeper interest charges and tough underwriting requirements, thes