The Pendulum on Credit
November 17, 2011
Back in the 2005 and 2006 a common joke among real estate agents had to do with the ease of obtaining financing for a home - both purchase money or refinancing. "If you can fog a mirror, you are qualified." This lax standard for creditworthiness contributed to the end of the real estate boom and the dearth in the availability of loans. Lenders tightened up the regulations and qualifying for a loan required tons of documentation, high FICO scores and job stability.
Some of these stricter standards have probably contributed to the decline in the volume of homes sold even though prices and interest rates are at new lows.
When you become serious about wanting to take advantage of this great real estate affordability environment, connect up with a loan agent. Find out what will be required. Have the loan agent run your credit, fill out the application accurately. If you are self employed, the process will require even more documentation. If you have made a job change recently you may be denied a loan.
Get your w-2s or 1099s and your tax forms ready to give to the lender. If you are being "gifted" a down payment try to have it deposit in your account. If it is coming from a family member, the lender may want to verify their account.
Loan money is available, but it requires the potential borrower to be an open book. Verification and documentation are the standards for today's lenders.
Back in the 2005 and 2006 a common joke among real estate agents had to do with the ease of obtaining financing for a home - both purchase money or refinancing. "If you can fog a mirror, you are qualified." This lax standard for creditworthiness contributed to the end of the real estate boom and the dearth in the availability of loans. Lenders tightened up the regulations and qualifying for a loan required tons of documentation, high FICO scores and job stability.
Some of these stricter standards have probably contributed to the decline in the volume of homes sold even though prices and interest rates are at new lows.
When you become serious about wanting to take advantage of this great real estate affordability environment, connect up with a loan agent. Find out what will be required. Have the loan agent run your credit, fill out the application accurately. If you are self employed, the process will require even more documentation. If you have made a job change recently you may be denied a loan.
Get your w-2s or 1099s and your tax forms ready to give to the lender. If you are being "gifted" a down payment try to have it deposit in your account. If it is coming from a family member, the lender may want to verify their account.
Loan money is available, but it requires the potential borrower to be an open book. Verification and documentation are the standards for today's lenders.
posted by shirley harry at 8:36 AM
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