Hey everyone,
Home lending is a big concern for most buyers out there because it is a very important piece in the puzzle of gaining home ownership. Therefore, it is good to know where the lenders are at with the leniency regarding giving out home loans. As most of us know, a big contributor of the housing market collapse was the fact that banks and other mortgage lenders were issuing loans to people who really did not qualify for the issued loan amounts. It got to a point where, if you had a pulse, you got a mortgage loan. But as we all saw, once the people responsible for the mortgages realized they could not afford the payments, they began to default. It was a dominos effect throughout the country, loans defaulting left and right. As you could expect, lenders are more serious about the qualification process because they want to make sure that they will get there money back. In 2011, home lending reached its lowest point since 1995 (a little before the lending went crazy). This low number of newly issued loans supports the reports of many people having a more difficult time qualifying for mortgages. There was a 10% drop in home loans last year coming out to 7.1 million issued loans. That number is .8 million lower than the number of loans issued in 2010. Although we have the extremely low mortgage rates, the drop is home loans issued is credited to the fact that lenders are being more strict and requiring higher credit scores to acquire a loan.
This is just some information to keep in mind when you start your research on mortgages and begin the process of applying.
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