Stampede Of The House Hunters

When they started their search for a first home late last year, Eric and Harumi Smith went by the book. A $10,000 downpayment? Check. Prequalified for a mortgage? Check. A 1.5-point interest-rate hike? Gulp. "I was already at the high end of my range," says Smith, a product manager for an Atlanta gourmet-food company. "When rates jumped up, I thought I'd lose the house." Instead, Smith negotiated a new deal with his bank in which he'll pay a below-market rate the first two years and a higher rate for the rest. "We were worried big time," he says now.

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