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Mortgage market gets messier

From the August issue: Ask half-a-dozen mortgage and real estate brokers which bank has the best rates for residential mortgages in New York City right now, and expect two dozen different answers.

Then check back again, in a week or even a day, for an entirely new set of replies.

Buyers have typically benefited from shopping around for mortgage rates from various lenders. However, in the wake of a massive government bailout of ailing banks plus a recessionary deep freeze in the credit markets, the residential mortgage market is more splintered than it has been in 15 years. What's more, it's only growing more fractured.

"It used to be three or four banks would control 80 percent of the market, but now it's 12 banks, and those constantly change," said Eric Appelbaum, president of Apple Mortgage Corp. in Manhattan. "Rates are between 4 7/8 and 5 3/8 right this second, and two months ago they were cheaper."

Look beyond the waves of volatility, and a few clear trends emerge. more