Mortgage Approvals Are Getting More And More Scarce « Home Loans …
Mortgage approvals are getting harder and harder to get these days. Everything has tightened up and it gets more difficult every day for you to qualify. Think about what that means to you if you are carrying other non mortgage debt and are thinking about a refinance in the next few years.
The bottom line is you may not be able to qualify later due to many reasons such as home values that have gone down, further restrictions from the lenders, or changes to your income or credit score. This points out another reason why you need to get ahead of your debt. If you start paying down your debt you’ll increase your available cash flow as you pay off each debt. You’ll improve your credit score faster by accelerating the payoff of your debts. Your debt to income ratio will improve as you pay down the debts. And you could start putting more money towards your retirement accounts and savings as you pay off the debts. You’ll be in a better position to qualify if you still need to.
But why stress over not being able to qualify for a refinance later when you may be able to ensure you don’t need it by getting your debts under control starting today?
Your friends at No More Mortgage
Read on and think about your future needs while you do.
David Kosmecki | February 9, 2010
The economy’s improving but lending standards are not. Nationally, banks are making mortgage approvals harder to come by.
Underwriting guidelines are tightening.
The data comes from the Federal Reserve’s quarterly survey to its member banks. The Fed asks senior bank loan officers around the country to report on “prime†residential mortgage guidelines over the most recent 3 months and whether they’ve tightened.
For the period October-December 2009:
- Roughly 1 in 4Â banks said guidelines tightened
- Roughly 3 in 4 banks said guidelines were “basically unchangedâ€
Just 2 of 53 banks said its guidelines had loosened.
Combine the Fed’s survey with recent underwriting updates from the FHA and generally tougher standards for conventional loans and it’s clear that lenders are much more cautious about their loans than they were, say, in 2007.
Today’s Plymouth home buyers and would-be refinancers face a bevy of new borrowing hurdles including:
- Higher minimum FICO scores
- Larger downpayment requirements for purchases
- Larger equity positions for refinances
- Lower debt-to-income ratios
So, if you’re on the fence about whether now is a good time to buy a home, or make that refi, consider acting sooner rather than later. It doesn’t necessarily matter that mortgage rates are low, or that there’s an up-to-$8,000 home purchase tax credit for households that qualify. With each passing quarter, fewer and fewer applicants are eligible to take advantage.
View the original story at
Home Loans Midwest – http://homeloansmidwestblog.com/
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Filed under Mortgage, No More Mortgage, debt by on Feb 9th, 2010. 
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