The news today says it is still hard to get a mortgage, but they do not clarify why it is hard to get one. After a statement like that, everyone assumes it is difficult to qualify no matter what type of transaction or history they have.

All of qualifying depends on whether you are trying to buy a new home or refinance one you already own and a number of other factors including credit scoring, equity or down payment, and debt ratio. This begins to sound confusing as we start to list all of the factors taken into account to see if whether you qualify or not, but in all reality, we've been doing this for years.

When I started in this business in 1995 we had a conventional 30 and 15 year fixed, 5/1 and 3/1 arms, and FHA and VA loans available with the same terms available. In today's market we are back to about the same set of loan options besides having a few other opportunities with USDA and some Grant or State programs. Arm programs are out of the picture because they are priced too high with inverse-yield curve and this now leaves us with a core set of programs available to use for qualifying.

Credit problem? Figure in most cases you will need a credit score above 600, although we can sometimes get to 580 with FHA and even lower with VA. This hasn't changed all that much except you won't see the old sub-prime mortgages around that seemed to have a large part in the housing crisis with the short-term arms and high rates.

Debt ratio issue? Ratio calculations haven't changed much at all, but banks are starting to follow the guidelines closer and use the ratio limits on conventional underwriting practices, but automated underwriting will still allow for ratios that exceed the quidelines if the overall loan application snapshot suggests the loan is a good one.

Equity/Down Payment missing? For refinances the equity problem is the main factor in a homeowner's ability to refinance. FHA and VA have great streamline programs which allow for no credit qualifying and no appraisal if you are bettering your position and do not exceed the original loan amount of the previous loan. Down payment has always been a concern over the years. Where do I get it? In many cases you can get a gift from family, a grant from a State/Local/etc program, at one time there were Down Payment Assistance programs DAPs. FHA is now a 3 ½% down payment program, VA and USDA are 0% down payment programs. This is where it pays to have a mortgage consultant who has great knowledge and experience in the business and the area to help find the best option available.

Still confused?

Don't be confused because it is our job as mortgage professionals to sort through the data, use our knowledge of mortgage program options, and pull out options to help customers buy or refinance a home. I've had many people come to me who thought they didn't qualify because they had a credit issue, didn't think they had money, or thought their debt ratio was too high. In some cases there are large enough issues to prevent buying or refinancing and those are times where we figure out the best path to remove those issues so we can do move forward down the road. In many instances I see someone has heard from someone and all of a sudden we have a purple elephant answering the phone (for those of you who remember that test). What I'm saying is, if we believed what some people say and what we hear in the media, we get the impression we can't do anything instead of finding out for ourselves if it is truly possible.

In all reality, we have the same mortgage programs we had in 1995 and we were doing good business then.